Direct material: 5 pounds at $10.00 per pound $ 50.00
Direct labor: 3 hours at $17 per hour 51.00
Variable overhead: 3 hours at $7 per hour 21.00
Total standard variable cost per unit $ 122.00
The company also established the following cost formulas for its selling expenses:
Fixed Cost per Month Variable Cost per Unit Sold
Advertising $ 330,000
Sales salaries and commissions $ 360,000 $ 25.00
Shipping expenses $ 16.00
The planning budget for March was based on producing and selling 24,000 units. However, during March the company actually produced and sold 30,600 units and incurred the following costs:
a. Purchased 170,000 pounds of raw materials at a cost of $9.00 per pound. All of this material was used in production.
b. Direct-laborers worked 68,000 hours at a rate of $18.00 per hour.
c. Total variable manufacturing overhead for the month was $512,040.
d. Total advertising, sales salaries and commissions, and shipping expenses were $340,000, $520,000, and $245,000, respectively.
10. What is the variable overhead efficiency variance for March? (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance.). Input the amount as a positive value.)
Variable overhead efficiency variance
