The following standards for variable manufacturing overhead have been established for a company that makes only one product: The following data pertain to operations for the last month:
What is the variable overhead efficiency variance for the month?

A) $15,550 Unfavorable
B) $15,200 Unfavorable
C) $16,530 Unfavorable
D) $980 Favorable

Question

The following standards for variable manufacturing overhead have been established for a company that makes only one product:

The following data pertain to operations for the last month:
The following standards for variable manufacturing overhead have been established for a company that makes only one product: The following data pertain to operations for the last month: What is the variable overhead efficiency variance for the month? A) $15,550 Unfavorable B) $15,200 Unfavorable C) $16,530 Unfavorable D) $980 Favorable

What is the variable overhead efficiency variance for the month?

A) $15,550 Unfavorable
B) $15,200 Unfavorable
C) $16,530 Unfavorable
D) $980 Favorable

Justin Grayson · Accepted Answer

Final Answer : B, Explanation :  Variable Overhead Efficiency Variance = (Standard Hours - Actual Hours) x Variable Overhead RateStandard Hours = 35,000 (based on the standard rate of 10 hours per unit for 3,500 units)Actual Hours = 37,000Variable Overhead Rate = $4.00Variance = (35,000 - 37,000) x $4.00 = $15,200 unfavorable.

Definitions

Learning Objectives

Learning Objectives

Related questions