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Acme Company’s production budget for August is 19,100 units and includes the following component unit costs: direct materials, $9.0; direct labor, $11.5; variable overhead, $5.0. Budgeted fixed overhead is $48,000. Actual production in August was 21,942 units, actual unit component costs incurred during August include direct materials, $10.00; direct labor, $11.00; variable overhead, $7.00. Actual fixed overhead was $51,100, the standard fixed overhead application rate per unit consists of $2.5 per machine hour and each unit is allowed a standard of 1 hour of machine time.
Required:
Calculate the fixed overhead budget variance and the fixed overhead volume variance. (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable.)
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