Question
I need detailed help with steps on how to solve, and why answer, which was A) is what it is : The Phelps Company uses
I need detailed help with steps on how to solve, and why answer, which was A) is what it is :
The Phelps Company uses a standard costing system. Overhead costs are applied to products on basis of direct labor hours. The standard cost card shows that 5 direct labor hours are required per unit of product. Phelps Company had the following budgeted and actual data for September :
Units Produced : Actual : 20,350 Budgeted : 20,000
Direct Labor Hours : Actual : 105,000 Budgeted : 100,000
Variable Overhead Costs : Actual : $91,000 Budgeted : $80,000
Fixed Overhead Costs : Actual : $55,100 Budgeted : $50,000
Question : What were the fixed overhead budget and volume variances respectively ? A) $5,100 Unfavorable & $875 Favorable
B) $11,000 Favorable & $875 unfavorable
C) $5,100 Favorable and $2,500 Favorable
D) None
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