Standard Cost System
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Benson Company, which uses a standard cost system, budgeted $600,000 of fixed overhead when 40,000 machine hours were anticipated. Other data for the period were:
Actual units produced: 10,000
Standard production time per unit: 3.9 machine hours
Fixed overhead incurred: $620,000
Actual machine hours worked: 42,000
Benson's fixed-overhead budget variance is:
A. $10,000 Favorable
B. $15,000 Favorable
C. $20,000 Favorable
D. $15,000 Unfavorable
E. $20,000 Unfavorable
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Solution Summary
The expert examines the standard cost systems for Benson Company.
Education
- BE, Bangalore University, India
- MS, University of Wisconsin-Madison
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