Abdul's Rugs Company manufactures rugs. The 2015 operating budget is based on the production of 5,000 rugs with 1.25 machine-hour allowed per rug. Variable manufacturing overhead is anticipated to be $150,000.
Actual production for 2015 was 5,500 rugs using 6,050 machine-hours. Actual variable costs were $23.75 per machine-hour.
Required:
Calculate the variable overhead spending and the efficiency variances.

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The Answer of Abdul's Rugs Company manufactures rugs. The 2015 operating budget is based on the production of 5,000 rugs with 1.25 machine-hour allowed per rug. Variable manufacturing overhead is anticipated to be $150,000.
Actual production for 2015 was 5,500 rugs using 6,050 machine-hours. Actual variable costs were $23.75 per machine-hour.
Required:
Calculate the variable overhead spending and the efficiency variances.

Abdul's Rugs Company Manufactures Rugs