Sweet Dreams manufactures candy.Its records revealed the following data: $$\begin{array} { l l }
\text { Standard variable overhead rate } & \$ 2 \text { per machine hour } \
\text { Standard fixed overhead rate } & \$ 1 \text { per machine hour } \
\text { Actual variable overhead costs } & \$ 361,000 \
\text { Actual fixed overhead costs } & \$ 175,000 \
\text { Budgeted fixed overhead costs } & \$ 190,000 \
\text { Standard machine hours per unit produced } & 10 \
\text { Good units produced } & 18,000 \
\text { Actual machine hours } & 200,000
\end{array}$$
The total variable overhead variance is

Question

Sweet Dreams manufactures candy.Its records revealed the following data: $$\begin{array} { l l } 
\text { Standard variable overhead rate } & \$ 2 \text { per machine hour } \
\text { Standard fixed overhead rate } & \$ 1 \text { per machine hour } \
\text { Actual variable overhead costs } & \$ 361,000 \
\text { Actual fixed overhead costs } & \$ 175,000 \
\text { Budgeted fixed overhead costs } & \$ 190,000 \
\text { Standard machine hours per unit produced } & 10 \
\text { Good units produced } & 18,000 \
\text { Actual machine hours } & 200,000
\end{array}$$ 
The total variable overhead variance is

Quizplus · Accepted Answer

The total variable overhead variance is calculated as follows:
Actual Variable Overhead - (Standard Variable Overhead Rate x Actual Output)
= $84,000 - ($1.20 x 68,000)
= $84,000 - $81,600
= $2,400 (F)
Since the actual overhead is greater than the standard overhead (Favorable), the variance is unfavorable (debit balance). Therefore, the answer is B) $3,200 (F).

Sweet Dreams Manufactures Candy The Total Variable Overhead Variance Is A) $3,200 (U)

Sweet Dreams Manufactures Candy The Total Variable Overhead Variance Is
A) $3,200 (U)