Nexus industries uses a standard costing system to apply manufacturing costs to its production process. In May nexus anticipated 2700 units with fixed manufacturing overhead costs allocated at $8.40 per direct labor hour with a standard of 2.5 direct labor hours per unit. In May, actual production was 3400 units and actual fixed manufacturing overhead cost were $23000.What was nexus fixed manufacturing overhead volume variance in May?

Respuesta :

Answer:

The nexus fixed manufacturing overhead volume variance in May was = 14,700 Unfavorable

Explanation:

Fixed manufacturing overhead volume variance

= Absorbed rate * (Actual Labor Hours - budgeted labor hours

= 8.40 * (3400*2.5 - 2700*2.5)

= 8.40 * (8500-6750)

= 14,700 Unfavorable