The Following Information Is Available for Baxter Manufacturing for April

The following information is available for Baxter Manufacturing for April:
$\begin{array}{lrr} \text { Actual machine hours } &840\\ \text { Standard machine hours allowed} &900\\ \text { Denominator activity (machine hours) } &1,000\\ \text {Actual fixed overhead costs } &\$3,800\\ \text { Budgeted fixed overhead costs } &\$4,000\\ \text { Predetermined overhead rate ( \( \$ 1 \) variable \( +\$ 4 \) fixed) } &\$\quad5\\\end{array}$

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Is the fixed overhead price (spending) variance for April favorable or unfavorable?

A) Favorable.
B) Unfavorable.

Correct Answer:

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