Question

41.

Sperazza Corporation produces large commercial doors for warehouses and other facilities. In the most recent month, the company budgeted production of 5,700 doors. Actual production was 6,100 doors. According to standards, each door requires 5.4 machine-hours. The actual machine-hours for the month were 33,790 machine-hours. The standard supplies cost is $1.70 per machine-hour. The actual supplies cost for the month was $52,712. Supplies cost is an element of variable manufacturing overhead. The variable overhead efficiency variance for supplies cost is:

$5,964 F

$1,445 F

$5,964 U

$1,445 U

Answer 1

The answer to the following question is as follows

Variable overhead efficiency variance =SVR(AH-SH)

SVR =$1.70 per machine hr

Actual Hours =33790

Standard Hours =6100*5.4

                              =32940

Therefore Variable Overhead Efficiency Variance =1.7*(33790-32940)

                                                                                        =$1445 U because the AH is more than the SH hrs so unfavourable

So the Correct answer is $1445 U