Security Doors has a standard variable overhead rate of $4 per direct labour hour. The standard quantity of direct labour per unit of production is 3 hours. The company's static budget was based on 50 000 units. Actual results for the year are as follows.
What was Security Door's variable overhead spending variance?
A) $45 000 favourable
B) $60 000 favourable
C) $15 000 unfavourable
D) $45 000 unfavourable

Question

Security Doors has a standard variable overhead rate of $4 per direct labour hour. The standard quantity of direct labour per unit of production is 3 hours. The company's static budget was based on 50 000 units. Actual results for the year are as follows. 
What was Security Door's variable overhead spending variance?
A) $45 000 favourable 
B) $60 000 favourable 
C) $15 000 unfavourable 
D) $45 000 unfavourable

Quizplus · Accepted Answer

The Answer of Security Doors has a standard variable overhead rate of $4 per direct labour hour. The standard quantity of direct labour per unit of production is 3 hours. The company's static budget was based on 50 000 units. Actual results for the year are as follows. 
What was Security Door's variable overhead spending variance?
A) $45 000 favourable 
B) $60 000 favourable 
C) $15 000 unfavourable 
D) $45 000 unfavourable

Security Doors Has a Standard Variable Overhead Rate of $4