Uses a standard cost system with direct labor hour

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Germosen, Inc. uses a standard cost system with direct labor hour (DLHs) as the application base for manufacturing overhead. Results for the year are below.

Prior to the start of the year:

Standard DLHs per unit .............................................. 0.20 DLHs per unit

Planned Production......................................................800,000 units

Budgeted DLHs (denominator hours)..........................160,000 DLHs

Predetermined Fixed MOH Rate.................................$12.48 per DLH

At the end of the year:

Actual production...........................................................795,000 units

Actual DLHs .................................................................158,000 DLHs

Actual FMOH Cost.......................................................$936,000

What was Germosen's FMOH Volume Variance for the year?

A. $ 24,960 Favorable

B. $24,960 Unfavorable

C. 12,480 Favorable

D. $12,480 Unfavorable

E. None of the above

Reference no: EM131295521

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