REQUIRED: Calculate the fixed overhead budget variance (the normal volume is 20,000 units) and fixed overhead sales volume variance .

Valley Company uses a standard cost system to control production costs. For 2018, the following data is available: Actual Standard/Budget Production 22,000 units Direct materials Quantity 100,000 kg 5 kg per unit of output (production) Cost $185,000 $1.60/kg Direct labor Hours 10,500 hours 1 hour per unit of output (production) Cost $160,000 $12/hour Overhead cost $205,000 (30% fixed) $200,000 (40% fixed) Variable overhead is applied on the basis of direct labor-hours. The application rate is $6 per direct labor-hour