Question
Blue Gum Ltd uses a standard costing system. The firm estimates that it will operate its manufacturing facilities at 868,000 machine hours for the year.
Blue Gum Ltd uses a standard costing system. The firm estimates that it will operate its manufacturing facilities at 868,000 machine hours for the year. The estimate for total budgeted overhead is $875,000. The standard variable overhead rate is estimated to be $3.7 per machine hour or $11.1 per unit. The actual data for the year are presented below:
Actual units produced | 282,000 |
Actual machine hours | 772,000 |
Actual variable overhead | 993,000 |
Actual fixed overhead | 346,000 |
Calculate and enter the amount of variable overhead spending variance in the answer space below: (Show negative sign in front of input if the variance is favourable)
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