The following information is available for the Danske Company:Denominator hours for MayActual hours worked during May Standard hours allowed for MayFlexible budget fixed overhead costActual fixed overhead costs for MayDanske Company had total underapplied overhead of $20,000. Additional information is as follows:Variable Overhead:Applied based on standard direct labor-hours allowedBudgeted based on standard direct labor-hoursFixed Overhead:Applied based on standard direct labor-hours allowedBudgeted based on standard dinect labon-hours$ 52,00043,000$ 40,00032,000What is the fixed overhead price (spending) variance for May?Multiple Choice$4,000 unfavorable94.100 unfavorable ### Overhead Variance Analysis for May#### Variable Overhead- **Applied based on standard direct labor-hours allowed:** $52,000- **Budgeted based on standard direct labor-hours:** $43,000#### Fixed Overhead- **Applied based on standard direct labor-hours allowed:** $40,000- **Budgeted based on standard direct labor-hours:** $32,000#### Question:What is the fixed overhead price (spending) variance for May?#### Multiple Choice Options:- $4,000 unfavorable- $4,100 unfavorable- $1,900 unfavorable- $4,100 favorable**Selected Answer:** - $4,000 unfavorableIn this analysis, you can see a comparison between the applied and budgeted overhead costs to determine variances. A variance is favorable if the actual costs are less than the budgeted costs, and unfavorable if more. This specific question focuses on the fixed overhead price variance, highlighting the difference between what was expected to be spent and what was actually allocated, based on labor hours. The following information is available for the Danske Company:- **Denominator hours for May:** 20,000- **Actual hours worked during May:** 18,100- **Standard hours allowed for May:** 14,000- **Flexible budget fixed overhead cost:** $60,000- **Actual fixed overhead costs for May:** $64,000Danske Company had a total underapplied overhead of $20,000. Additional information is as follows:- **Variable Overhead:** - Applied based on standard direct labor-hours allowed: $52,000 - Budgeted based on standard direct labor-hours: $43,000- **Fixed Overhead:** - Applied based on standard direct labor-hours allowed: $40,000 - Budgeted based on standard direct labor-hours: $32,000**Question:** What is the fixed overhead price (spending) variance for May?**Multiple Choice:**- $4,000 unfavorable- $4,100 unfavorableThe correct answer is selected as **$4,000 unfavorable**.

Name: The following information is available for the Danske Company:Denomina
Uploaded: 2024-03-20T06:33:06.000Z
Channel: Bartleby
Description: The following information is available for the Danske Company:Denominator hours for MayActual hours worked during May Standard hours allowed for MayFlexible budget fixed overhead costActual fixed overhead costs for MayDanske Company had total underap

Fixed overhead- spending variance is difference between actual overhead- and budgeted overhead. Actual fixed overhead is the actual cost per unit of fixed overhead. Budgeted fixed overhead is expected cost per unit of fixed overhead. Fixed overhead-spending variance = Budgeted fixed overhead- Actual fixed overhead= $60,000 - $64,000= $4000 unfavorable. Therefore, correct answer is 1st option= $4000 unfavorable