Wednesday, June 8, 2011

What is the variable overhead efficiency variance?

ACCOUNTING

Multiple Choice

Roberts Corporation manufactured 100,000 buckets during February. The overhead cost-allocation base is $5.00 per machine-hour. The following variable overhead data pertain to February.

Actual Budgeted

Production 100,000 units 100,000 units

Machine-hours 9,800 hours 10,000 hours

Variable overhead cost per machine-hour $5.25 $5.00


What is the variable overhead efficiency variance?

a. $1,000 favorable

b. $1,450 unfavorable

c. $2,450 unfavorable

d. none of the above

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