The following standards for variable overhead have been established for a company that makes only one product: Standard hours per unit of output 6.6 hours Standard variable overhead rate $13 per hour The following data pertain to operations for the last month: Actual hours Actual total variable overhead cost $125,210 Actual output 9,800 hours 1,460 units Required: A. What is the variable overhead rate variance for the month? B. What is the variable overhead efficiency variance for the month?

Principles of Accounting Volume 2
19th Edition
ISBN:9781947172609
Author:OpenStax
Publisher:OpenStax
Chapter8: Standard Costs And Variances
Section: Chapter Questions
Problem 10EA: ThingOne Company has the following information available for the past year. They use machine hours...
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The following standards for variable overhead have been established for a
company that makes only one product:
Standard hours per unit of output 6.6 hours
Standard variable overhead rate $13 per hour
The following data pertain to operations for the last month:
Actual hours
Actual total variable overhead cost $125,210
Actual output
9,800 hours
1,460 units
Required:
A. What is the variable overhead rate variance for the month?
B. What is the variable overhead efficiency variance for the month?
Transcribed Image Text:The following standards for variable overhead have been established for a company that makes only one product: Standard hours per unit of output 6.6 hours Standard variable overhead rate $13 per hour The following data pertain to operations for the last month: Actual hours Actual total variable overhead cost $125,210 Actual output 9,800 hours 1,460 units Required: A. What is the variable overhead rate variance for the month? B. What is the variable overhead efficiency variance for the month?
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