Question
Cheerful Colors allocates manufacturing overhead based on direct labor hours. Each batch of crayons should require two direct labor hours. According to the static budget,
Cheerful Colors allocates manufacturing overhead based on direct labor hours. Each batch of crayons should require two direct labor hours. According to the static budget, the company expects to incur the following: 1,200 DLHrs per month, $6,000 in variable manufacturing overhead, and $5,550 in fixed manufacturing overhead. During June Cheerful Colors actually used 800 direct labor hours to make 1,200 batches of crayons and spent $5,200 in variable manufacturing costs and $8,000 in fixed manufacturing costs. Cheerful Colors variable overhead efficiency variance was ________. (Round intermediary calculations to the nearest cent and your final calculation to the nearest whole dollar.)
Answer A $2,600 F
Answer B $8,000 F
Answer C $8,000 U
Answer D $2,600 U
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