Answer (A) is correct . The variable overhead efficiency variance is found by multiplying the difference between standard hours and actual hours by the standard rate. The number of standard hours is calculated by multiplying the actual units by the standard hours per unit. Thus, the number of standard hours is 9,900 ($2,200 × 4.5 hours per unit), and the variable overhead efficiency variance is $0 [(9,900 – 9,900) × $2].
Answer (B) is incorrect because Multiplying by the budgeted number of units, 2,000, instead of actual, 2,200, results in $900 unfavorable.
Answer (C) is incorrect because Using a standard hours per unit rate of 9?hours and reversing the order of subtraction results in $9,900 unfavorable.
Answer (D) is incorrect because Using a standard hours per unit rate of 9 hours results in $9,900 favorable.
|
What is Funtime’s variable overhead efficiency variance?
