Webster has the following budgeted costs at its anticipated production level (expressed in hours): variable overhead, $150,000; fixed overhead, $240,000. If Webster now revises its anticipated production slightly downward, it would expect:
A. total fixed overhead of $240,000 and a lower hourly rate for variable overhead.
B. total fixed overhead of $240,000 and the same hourly rate for variable overhead.
C. total fixed overhead of $240,000 and a higher hourly rate for variable overhead.
D. total variable overhead of less than $150,000 and a lower hourly rate for variable overhead.
E. total variable overhead of less than $150,000 and a higher hourly rate for variable overhead.
Answer: B. total fixed overhead of $240,000 and the same hourly rate for variable overhead.
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