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Frekko Company collected the following information: Standard costs per unit: Variable overhead 4 machine hours @ $6 per machine hour Fixed overhead 4 machine hours

Frekko Company collected the following information:

Standard costs per unit:

Variable overhead 4 machine hours @ $6 per machine hour

Fixed overhead 4 machine hours @ $10 per machine hour

Actual output 20,000 units

Denominator (normal capacity) output 21,000 units

Actual machine hours 79,000 machine hours

Actual variable overhead cost $540,000

Actual fixed overhead cost $810,000

Using the three variance method, what is the spending variance?

Answer

a.$36,000 (U)

b.$30,000 (U)

c.$36,000 (F)

d.$30,000 (F)

I know the answer is A but have no idea on how to get it. Can you please help with the formula and calculation

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