Oddo Corporation makes a product with the following standard costs: The company reported the following results concerning this product in December. The company applies variable overhead on the basis of direct labor-hours.The direct materials purchases variance is computed when the materials are purchased. The variable overhead efficiency variance for December is:

Question

Oddo Corporation makes a product with the following standard costs:  The company reported the following results concerning this product in December.  The company applies variable overhead on the basis of direct labor-hours.The direct materials purchases variance is computed when the materials are purchased. The variable overhead efficiency variance for December is:

Quizplus · Accepted Answer

SH = 4, 200 units × 0.7 hours per unit = 2, 940 hours
Variable overhead efficiency variance = (AH - SH)× SR
= (3, 160 hours - 2, 940 hours)× $5.00 per hour
= (220 hours)× $5.00 per hour
= $1, 100 U

Oddo Corporation Makes a Product with the Following Standard Costs