ACCA · Question 29 · Standard costing
A company absorbs variable overheads on the basis of direct labor hours.
Standard variable overhead rate: $3 per hour.
Standard time per unit: 4 hours.
Actual production: 2,000 units.
Actual hours worked: 8,200 hours.
Actual variable overhead cost: $25,000.
What is the variable overhead efficiency variance?
Answer options:
$400 Favorable
$600 Adverse
$1,000 Adverse
$600 Favorable
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