Reference: 11-06 the Alpha Company Produces Toys for National Distribution. Standards for Standards

Multiple Choice

Reference: 11-06
The Alpha Company produces toys for national distribution. Standards for a particular toy are:
Materials: 12 grams per unit at 56 per gram. Labour: 2 hours per unit at $12.75 per hour.
During the month of December, the company produced 1,000 units. Information for the month follows: Materials: 14,000 grams were purchased and used at a total cost of $7,140.
Labour: 2,500 hours worked at a total cost of $33,000.
-Web Company uses a standard cost system in which manufacturing overhead is applied to units of product on the basis of machine-hours. During February, the company used a denominator activity of 80,000 machine-hours in computing its predetermined fixed overhead rate. However, only 75,000 standard machine-hours were allowed for the month's actual production. If the fixed overhead volume variance for February was
$6,400 unfavourable, then the total budgeted fixed overhead cost for the month was:

A) $96,000.
B) $98,600.
C) $102,400.
D) $100,000.