CH 11-Q6-D)

REQUIRED:

What was the actual variable overhead rate?

The following information is available for Marigold Shirts: Standard Quantity Standard Cost Total Standard Cost Direct Materials 3 metres $10/metre $30 Direct Labour 2 hours $10/hour $20 Variable Overhead 2 machine hours $2/machine hour $4 Fixed Overhead 2 machine hours $1/machine hour $2 $56 The normal production level is 260 shirts. This production period Marigold produced 240 shirts. Concert Wear purchased 780 metres of fabric for $6,786. The variances for the production period are: Materials Price Variance ? Materials Quantity Variance $240 U Labour Rate Variance $456 U Labour Efficiency Variance $240 F VOH Spending Variance $86 F VOH Efficiency Variance $100F FOH Budget Variance $90 F FOH Volume Variance $40 U