Question

Riverside Manufacturing designs and manufactures batus for home and commercial applications. Riverside recorded the following data for its commercial bathtub production line during the month of March Standard DL hours pertub Standard overhead rate per hour Standard Overhead cost per unit $12.00 Actual overhead costs Actual DL hours Actual Overhead cost per machine hour Actual tubs produced 1300 What is the variable manufacturing overhead rate variance in March? $3000 favorable $7500 unfavorable $3600 unfavorable $7500 favorable

Answer 1

Answer

• Correct Answer = Option #2: $ 7500 Unfavourable

Variable Overhead Rate Variance
(	Standard Rate	-	Actual Rate	)	x	Actual Labor Hours
(	$                                4.00	-	$                       6.50	)	x	3000
	-7500
	Variance		$              7,500.00			Unfavourable-U