In: Accounting
Bellingham Company produced 6,600 units of product that required
8.5 standard direct labor hours per unit. The standard variable
overhead cost per unit is $6.10 per direct labor hour. The actual
variable factory overhead was $332,290. Determine the variable
factory overhead controllable variance. Enter a favorable variance
as a negative number using a minus sign and an unfavorable variance
as a positive number.
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Answer: |
Variable Factory Overhead Controllable
variance = Standard overhead cost (-) Actual Overhead cost = ( 6,600 units x 8.5 DLH x $ 6.10 per DLH ) (-) $ 332,290 = $ 342,210 (-) $ 332,290 = ($ 9,920 ) Favourable. |
Variable Factory Overhead Controllable variance = ($ 9,920 ) Favourable. |