Question

X Company's 2018 budgeted cost function for variable overhead was C=$8.70X, where X is the number of units produced, and its budgeted cost function for fixed overhead was C=$206,600. The following information is also available for 2018:

	Master	Actual
	Budget	Results
Production	11,000 units	11,300 units
Total variable costs	$95,700	$111,361
Total fixed costs	$206,600	$210,843

What was the total overhead flexible budget variance for 2018 [a positive number means a favorable variance and a negative number means an unfavorable variance]?

A: $-5,673

B: $-8,225

C: $-11,927

D: $-17,294

E: $-25,076

F: $-36,361

G: $-52,723

H: $-76,448

Answer 1

D: $-17,294

Explanation:

	Master		Actual
	Budget for 11,000 units	Budget for 11,300 units	Actual Results
Production	11,000 units	11300	11,300 units
Total variable costs	$95,700	$                      98,310.00	$     111,361.00
Total fixed costs	$206,600	$                   206,600.00	$     210,843.00
Total		$           304,910.00	$ 322,204.00
Difference		$                                     17,294.00

In case of any doubt, please comment.