ABC Company provided you with the following data: Budgeted Fixed FOH costs $207,000; Actual FOH incurred $555,000; Variable FOH rate per direct labor hour $5; Fixed FOH rate per direct labor hour $3; Standard direct labor hours 68,000; Actual direct labor hours used 70,000. What is the total amount of spending variance? $2,000 Unfavorable $2,000 Favorable $8,000 Unfavorable $8,000 Favorable None of the above
Master Budget
A master budget can be defined as an estimation of the revenue earned or expenses incurred over a specified period of time in the future and it is generally prepared on a periodic basis which can be either monthly, quarterly, half-yearly, or annually. It helps a business, an organization, or even an individual to manage the money effectively. A budget also helps in monitoring the performance of the people in the organization and helps in better decision-making.
Sales Budget and Selling
A budget is a financial plan designed by an undertaking for a definite period in future which acts as a major contributor towards enhancing the financial success of the business undertaking. The budget generally takes into account both current and future income and expenses.
ABC Company provided you with the following data: Budgeted Fixed FOH costs $207,000; Actual FOH incurred $555,000; Variable FOH rate per direct labor hour $5; Fixed FOH rate per direct labor hour $3; Standard direct labor hours 68,000; Actual direct labor hours used 70,000. What is the total amount of spending variance?
$2,000 Unfavorable
$2,000 Favorable
$8,000 Unfavorable
$8,000 Favorable
None of the above
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