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Question - The standard factory overhead rates are based on a normal monthly volume of 1.5 standard direct labor hour per unit. The standard factory fixed overhead rate per direct labor hour is $3. The company has a normal activity of mono units. The actual units produced are 20,600 units. The actual fixed overhead cost was $110,000.
Required -
1. Compute the fixed overhead spending variance.
2. Compute the fixed overhead volume variance.
3. Prepare all the relevant journal entries (including the closing entry).
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