The actual and standard factory overhead costs for producing a specified quantity of product are as follows:
Actual: Variable factory overhead |
$72,500 |
|
Fixed factory overhead |
40,000 |
$112,500 |
Standard: 19,000 hours at $6 |
|
|
($4 variable and $2 fixed) |
|
114,000 |
If 1,000 hours were unused, the fixed factory overhead volume variance would be:
A. $1,500 favorable.
B. $2,000 unfavorable.
C. $4,000 unfavorable.
D. $6,000 unfavorable.