Mattison Company Has Developed Cost Formulas for the Drivers of the Following

Multiple Choice

Mattison Company has developed cost formulas for the drivers of the following production activities: $$\begin{array} { l l r } { \text { Driver } } & \text { Activity } & \text { Fixed }& \text { Variable } \\\hline \text { Labor hours } & \text { Materials } & \$ 0&\$20\\\text { Labor hours } & \text { Labor } & 0 &10\\\text { Machine hours } & \text { Maintenance } & 10,000&8 \\\text { Machine hours } & \text { Machining } & 50,000&2 \\\text { Number of setups } & \text { Inspections } & 30,000&200 \\\text { Number of setups } & \text { Setups } & 0 &300\\\text { Number of purchase orders } & \text { Purchasing } & 75,000&3\end{array}$$ If the actual activity was 20 setups and the actual fixed cost for inspections was $28,000 and the variable cost for inspections was $5,000, the total variance for inspections is

A) $1,000 favorable.
B) $2,000 favorable.
C) $1,000 unfavorable.
D) $2,000 unfavorable.