Exercise $10$A$-5($Algo$)$ Using Fixed Overhead Variances $[$LO$10-4]$

The standard cost card for the single product manufactured by Cutter, Incorporated, is given below:

Manufacturing overhead is applied to production based on standard direct labor$-$hours. During the year, the company worked $8,950$

hours and manufactured $12,500$ units. Selected data relating to the company's fixed manufacturing overhead cost for the year are

shown below:

Actual Fixed Overhead $=$$$44,000$

Budgeted Fixed Overhead $=?$

Fixed Overhead Applied to Work in Process $=?$ hours $$$ $?$ per hour $=$$ $?$

Budget variance $=$$ $?$

Volume variance $=$$$1,250F$

Required:

What were the standard hours allowed for the year's production?

What was the amount of budgeted fixed overhead cost?

What was the fixed overhead budget variance?

Note: Indicate the effect of each variance by selecting $"$F$"$ for favorable, $"$U$"$ for unfavorable, and "None" for no effect $($i$.$e$.,$ zero

variance$).$ Input all amounts as positive values.

What denominator activity level did the company use in setting the predetermined overhead rate?