Question: Answer the following questions (#25 and #26) using the information below: Jenny's Corporation manufactured 26,000 grooming kits for horses during March. The fixed-overhead cost-allocation rate

Answer the following questions (#25 and #26) using the information below:

Jenny's Corporation manufactured 26,000 grooming kits for horses during March. The fixed-overhead cost-allocation rate is $20 per machine-hour. The following fixed overhead data pertain to March:

Actual Static Budget

Production 26,000 units 24,000 units

Machine-hours 6,100 hours 6,000 hours

Fixed overhead costs $126,000 $120,000

What is the fixed overhead spending variance?

  • A.

    $6,000 unfavorable

  • B.

    $2,000 unfavorable

  • C.

    $4,000 favorable

  • D.

    $10,000 favorable

Jenny's Corporation manufactured 26,000 grooming kits for horses during March. The fixed-overhead cost-allocation rate is $20 per machine-hour. The following fixed overhead data pertain to March:

Actual Static Budget

Production 26,000 units 24,000 units

Machine-hours 6,100 hours 6,000 hours

Fixed overhead costs $126,000 $120,000

What is the fixed overhead production-volume variance?

  • A.

    $4,000 favorable

  • B.

    $10,000 favorable

  • C.

    $2,000 unfavorable

  • D.

    $6,000 unfavorable

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