Doogan Corporation makes a product with the following standard costs:

	Standard Quantity or Hours			Standard Price or Rate
Direct materials		8.0	grams	$	2.60	per gram
Direct labor		0.7	hours	$	26.00	per hour
Variable overhead		0.7	hours	$	7.60	per hour

The company produced 5,800 units in January using 39,910 grams of direct material and 2,440 direct labor-hours. During the month, the company purchased 45,000 grams of the direct material at $2.30 per gram. The actual direct labor rate was $25.30 per hour and the actual variable overhead rate was $7.40 per hour.

The company applies variable overhead on the basis of direct labor-hours. The direct materials purchases variance is computed when the materials are purchased.

The variable overhead rate variance for January is:

Multiple Choice

• $488 F

• $488 U

• $812 U

• $812 F