12.7k views
0 votes
Pilot Manufacturing prepared a report and noted budgeted fixed overhead costs of $3.75 per unit at 1,400 units. In November, the managerial accountant incurred actual fixed overhead costs of $4,200 and the actual production was 1,400 units.

What is Pilot Manufacturing's fixed overhead budget variance for October?

1 Answer

2 votes

Answer:

$1,050 favorable

Step-by-step explanation:

The computation of the fixed overhead budget variance is shown below:

= Actual fixed overhead - budgeted fixed overhead

where,

Budgeted fixed overhead is

= $3.75 × 1,400 units

= $5,250

And, the actual fixed overhead is $4,200

So, the fixed overhead budget variance is

= $4,200 - $5,250

= $1,050 favorable

Since the budgeted fixed overhead is more than the actual one so it would be favorable

User Utkarsh
by
7.5k points
Welcome to QAmmunity.org, where you can ask questions and receive answers from other members of our community.