H&X Co. uses a standard job cost system with a normal capacity of 25,500 direct labour hours.
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Question:
H&X Co. uses a standard job cost system with a normal capacity of 25,500 direct labour hours. H&X Co. produces 12,100 units, which cost $186,400 for direct labour (23,300 hours), $27,467 for variable overhead, and $131,285 for fixed overhead. The standard variable overhead per unit is $2 (2 hours at $1 per hour), and the standard fixed overhead per unit is $10.00 (2 hours at $5.00 per hour).
Calculate the variable overhead spending variance and the variable overhead efficiency variance.
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