Madrigal Industries makes a product with the following standard costs:

	Standard Quantity or Hours		Standard Price or Rate
Direct materials	7.7	grams	$ 2.30	per gram
Direct labor	0.5	hours	$ 23.00	per hour
Variable overhead	0.5	hours	$ 7.30	per hour

The company produced 5,500 units in January using 39,610 grams of direct material and 2,410 direct labor hours. During the month, the company purchased 44,700 grams of the direct material at $2.00 per gram. The actual direct labor rate was $22.30 per hour and the actual variable overhead rate was $7.10 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:

Options:

1. $550 U
2. $482 F
3. $482 U
4. $550 F