Question
Doogan Corporation makes a product with the following standard costs: Standard Quantity or Hours Standard Price or Rate Direct materials 8.2 grams $ 2.80 per
Doogan Corporation makes a product with the following standard costs: Standard Quantity or Hours Standard Price or Rate Direct materials 8.2 grams $ 2.80 per gram Direct labor 0.4 hours $ 28.00 per hour Variable overhead 0.4 hours $ 7.80 per hour The company produced 6,000 units in January using 40,110 grams of direct material and 2,460 direct labor-hours. During the month, the company purchased 45,200 grams of the direct material at $2.50 per gram. The actual direct labor rate was $27.30 per hour and the actual variable overhead rate was $7.60 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:
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