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Jones Incorporated uses direct labour hours as its basis for overhead allocation. Jones produces 1,000 units of product this month, utilizing 5,050 direct labour hours

Jones Incorporated uses direct labour hours as its basis for overhead allocation. Jones produces 1,000 units of product this month, utilizing 5,050 direct labour hours in the process. In incurring 5,050 direct labour hours this month, Jones incurred direct labour cost of $30,000, variable manufacturing overhead of $11,500, and fixed manufacturing overhead of $8,000. Standard variable overhead per unit is expected to be $12.50 per unit (5 hours at $2.50 per hour). Fixed overhead standard is expected to be $7.50 per unit (5 hours at $1.50 per hour). Based on the above calculate the FMOH efficiency variance. If an unfavourable variance enter amount as a negative.

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