SouthHaven Corporation applies overhead based on direct labor hours. According to standard cost card, the variable overhead standard is 11.5 hours at $20.5 per hour. During July, SouthHaven produced 4,600 units using 52,380 labor hours and spent $1,091,700 for variable overhead. What is the variable overhead efficiency variance? Multiple Choice $17,910 unfavorable $979,490 favorable
Variance Analysis
In layman's terms, variance analysis is an analysis of a difference between planned and actual behavior. Variance analysis is mainly used by the companies to maintain a control over a business. After analyzing differences, companies find the reasons for the variance so that the necessary steps should be taken to correct that variance.
Standard Costing
The standard cost system is the expected cost per unit product manufactured and it helps in estimating the deviations and controlling them as well as fixing the selling price of the product. For example, it helps to plan the cost for the coming year on the various expenses.
SouthHaven Corporation applies
According to
During July, SouthHaven produced 4,600 units using 52,380 labor hours and spent $1,091,700 for variable overhead.
What is the variable overhead efficiency variance?
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$17,910 unfavorable
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$979,490 favorable
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$17,910 favorable
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$10,660 favorable
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