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QUESTION 5 Prime Corporation budgeted fixed manufacturing costs of $144,000 during the year. Other information for the year includes: Units produced total 3,150 units.

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QUESTION 5 Prime Corporation budgeted fixed manufacturing costs of $144,000 during the year. Other information for the year includes: Units produced total 3,150 units. Units sold total 2,500 units. Beginning inventory was zero. The budgeted denominator level was 3,000 units. The company uses absorption costing and the fixed manufacturing cost rate is based on the budgeted denominator level. Manufacturing variances are closed to cost of goods sold. The production-volume variance is: $24,000 U $14,400 F $9,600 U $7,200 F

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