Question

Fixed overhead was budgeted at $200,000, and 25,000 direct labor hours were budgeted. If the fixed overhead volume variance was $8,000 favorable and the fixed overhead spending variance was $6,000 unfavorable, fixed overhead applied must be

Answer 1

$208,000

Step-by-step explanation:

Calculation for fixed overhead applied

Using this formula

Fixed overhead applied =Budgeted Fixed overhead+Fixed overhead volume variance

Let plug in the formula

Fixed overhead applied =$200,000+$8,000

Fixed overhead applied=$208,000

Therefore Fixed overhead applied must be $208,000