Diekow Productions manufactured and sold 1,000 products at $11,000 each during t

Question

Diekow Productions manufactured and sold 1,000 products at $11,000 each during the past year. At the beginning of the year, production had been set at 1,200 products; direct materials standards had been set at 100 pounds of direct materials at $2 per pound for each product produced. During the year, the company purchased and used 98,000 pounds of direct materials; the cost was $2.04 per pound. At the beginning of last year, Diekow Productions set budgeted fixed overhead costs at $456,000. During the year, actual fixed overhead costs were $500,000.

Calculate Diekow Production's fixed overhead budget and volume variances for the year. Assume that fixed overhead is applied based on units of product.

Fixed overhead budget variance; $ _______________ (Favorable / Unfavorable / No effect)

Fixed overhead volume variance: $________________ (Favorable / Unfavorable / No effect)

Explanation / Answer

i could only find the first one, which would be fixed overhead budget variance. We would take 456,000-500,000=44,000 (unfavorable). Still working on the second part

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