Teana Corporation uses machine hours as its denominator activity for fixed manufacturing overhead. For the most recent year, the company showed the following data:
At the beginning of the year :
Budgeted Machine Hours (denominator level) : 600,000 Machine Hours
At the end of the year:
Actual Fixed Manufacturing Overhead : $260,000
Fixed Manufacturing Overhead Budget Variance : $20,000 Favorable
Fixed Manufacturing Overhead Volume Variance : $15,000 Favorable
Question : Teana's standard machine hours allowed for actual output was closest to ?
A) 562,500 Machine Hours B) 632,143 Machine Hours C) 637,500 Machine Hours D) 567,857 Machine Hours E) None