Eminem, Inc Overhead Is Allocated Based on the Number of Units Produced

Multiple Choice

Eminem, Inc. manufactures music CDs. At the start of 2014, Eminem planned to produce 108,000 CDs for which the standard cost for each CD is:
$\begin{array}{lr}\text { Plastic ( } 0.25 \text { pounds at } \$ 6.00 \text { per pound) } & \$ 1.50 \\\text { Labor }(0.10 \text { hour at } \$ 12.00 \text { per hour) } & 1.20 \\\text { Overhead ( } \$ 0.80 \text { fixed and } \$ 0.60 \text { variable) } & 1.40\\\text { Total }&\$4.10\end{array}$
Overhead is allocated based on the number of units produced. Eminem isolates material purchase variances at the point of purchase. The following information summarizes Eminem's results for 2014:
$\begin{array} { l r } \text { Actual production } & 110,000 \text { CDs } \\\text { Actual variable overhead } & \$ 65,000 \\\text { Actual fixed overhead } & \$ 83,000\end{array}$
How much is the controllable overhead variance for 2014?

A) $4,400 favorable
B) $1,600 favorable
C) $6,000 favorable
D) $5,000 favorable