Cabot Company collected the following data regarding production of one of its products.Compute the variable overhead cost variance.
A)$18,000 favorable.
B)$4,000 favorable.
C)$18,000 unfavorable.
D)$18,300 favorable.
E)$14,300 unfavorable.

Question

Cabot Company collected the following data regarding production of one of its products.Compute the variable overhead cost variance. 
A)$18,000 favorable. 
B)$4,000 favorable. 
C)$18,000 unfavorable. 
D)$18,300 favorable. 
E)$14,300 unfavorable.

Quizplus · Accepted Answer

Actual variable overhead costs = $1,140,000
Applied = 40,000 * $28.60 = $1,144,000; Variable overhead cost variance = $4,000 favorable

Cabot Company Collected the Following Data Regarding Production of One