I'm feeling confident about this one. The answer is clearly B) $6,000F. It's like taking candy from a baby, or in this case, a fixed production overhead capacity variance from a multiple-choice exam. Piece of cake!
The fixed production overhead capacity variance is the difference between the standard fixed overhead cost for the actual production volume and the fixed overhead cost for the budgeted production volume. In this case, the budgeted fixed overhead cost is $30,000 and the actual fixed overhead cost is $24,000, so the answer must be B) $6,000F.
Hmm, I'm not sure about this one. Let me think it through again. I guess I'll go with C) $3,000F, just to be different. Who knows, maybe I'll get lucky!
I agree, because the actual fixed production overhead is $15,000 and the budgeted fixed production overhead is $9,000. So the fixed production overhead capacity variance is $6,000F
I think the answer is B) $6,000F. The fixed production overhead capacity variance is the difference between the standard fixed overhead cost for the actual production volume and the fixed overhead cost for the budgeted production volume. In this case, the budgeted fixed overhead cost is $30,000 and the actual fixed overhead cost is $24,000, resulting in a $6,000 favorable variance.
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