The standard cost card for Sail Company's only product shows the following information.
Standard cost
per unit
Variable overhead, 1.5 direct labour hours
$6.00
at $4.00 per hour
Fixed overhead, 1.5 direct labour hours at
$9.00
$6.00 per hour
The company manufactured and sold 14,500 units of product during the year. Overhead cost is
applied to products on the basis of direct labour hours. The budgeted fixed overhead costs as
shown on the flexible budget were $157,500, while actual fixed overhead costs were $150,000.
Based on the above information, the fixed overhead volume variance is $27,000 unfavourable.
Select one:
True
