Question
Sunshield is a company that manufactures bottles of sunscreen. Below is basic information related to Sunshield's 2019 operations, in units: Theoretical capacity 275,000 Practical capacity
Sunshield is a company that manufactures bottles of sunscreen. Below is basic information related to Sunshield's 2019 operations, in units: Theoretical capacity 275,000 Practical capacity 265,000 Normal capacity 260,000 Production 250,000 Sales 270,000 Assume beginning inventory was 20,000 bottles. Consider Sunshield's possible choices for capacity, used to calculate the budgeted fixed manufacturing overhead rate. Complete the following statements: _________ would result in the largest production volume variance; _________ would result in a favorable production volume variance. a. theoretical capacity; none of the capacity choices b. normal capacity; practical and normal capacity c. normal capacity; theoretical capacity d. theoretical capacity; all of the capacity choices
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