14. Question Content Area

Salvador Company has developed capacity standards. Information is as follows for a value-added activity:

Activity capacity acquired60Activity capacity used50Actual activity usage30Standard fixed activity rate$2,000

The unused capacity variance is

a. There is no variance.

b. $40,000 favorable.

c. $20,000 favorable.

d. $60,000 favorable.

15. Question Content Area

Livingston Company has developed capacity standards. Information about a non-value-added activity is as follows:

Standard cost of the activity capacity acquired$60,000Standard cost of the activity capacity used0Standard cost of the actual activity used50,000

The volume variance is

a. $10,000 unfavorable.

b. $60,000 unfavorable.

c. $10,000 favorable.

d. $60,000 favorable.