Griffen Corporation uses a standard costing system. Information for the month of May is as follows: Actual manufacturing overhead costs ($26,000 is fixed) $80,000 Direct labor: Actual hours worked 12,000 hrs. Standard hours allowed for actual production 10,000 hrs. Average actual labor cost per hour $18.00 The overhead rate is based on a normal volume of 12,000 direct labor hours. Standard cost data at 12,000 direct labor hours were as follows: $48,000 24,000 $72,000 Variable overhead Fixed overhead Total overhead What is the fixed overhead spending variance for Griffen? a. $8,000 U b. $4,000 U O c. $20,000 U QUESTION 6 Vest Industries manufactures 40,000 components per year. The manufacturing cost of the components was determined as follows: $ 75,000 Direct materials Direct labor Variable overhead 120,000 45,000 Fixed overhead 60,000 $300,000 Total An outside supplier has offered to sell the component for $12.75. Fixed costs will remain the same if the component is purchased from an outside supplier. What is the effect on income if Vest Industries purchases the component from the outside supplier? O a. $270,000 increase b. $30,000 increase OC. $30,000 decrease d. $270,000 decrease