MNO produces a single product. The standard production requirement for each unit requires 0.50 variable overhead hours
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Question:
MNO produces a single product. The standard production requirement for each unit requires 0.50 variable overhead hours at a standard rate of $4 per hour. During the last year, MNO assembly line workers worked a total of 2,000 hours. Variable overhead spending was $9,600 to MNO and is allocated based on direct labour hours. Also last year, MNO manufactured 3,000 units of product. What was the company's variable overhead spending variance for the year?
a)nill
b) $4000 unfavourable
c) $1600 favourable
d) $1600 unfavourable
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