Problem:
Vaughn Corporation budgeted $134,400 for its fixed-MOH cost going into the current year. Its actual fixed-MOH cost came in on budget, but it produced and sold 2,500 units instead of the budgeted 3,200. Vaughn's actual variable manufacturing costs came in on budget at $50 per unit. What is Vaughn's fixed-MOH volume variance for this year, recognizing that it uses standard costs within is absorption costing system? What is the company's initial COGS (before any variance is considered) and also its adjusted COGS after writing off that variance directly to COGS? Fixed-MOH volume variance Unadjusted COGS $ Adjusted COGS $