Stiller Corporation incurred fixed manufacturing costs of $ 30 000 during 2015.

Question

Stiller Corporation incurred fixed manufacturing costs of $ 30 000 during 2015. Other information for 2015 includes: The budgeted denominator level is 2400 units. Units produced total 1 comma 800 units. Units sold total 1400 units. Beginning inventory was zero. The company uses absorption costing and the fixed manufacturing cost rate is based on the budgeted denominator level. Manufacturing variances are closed to cost of goods sold. The productionminus volume variance is ________.

A.$ 5 comma 000

B.$ 7 comma 500

C.$ 12 comma 500

D.$0

Explanation / Answer

The production volume variance = (30000/2400)*(2400-1800)= 7500 Option B is correct

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