Puvo, Inc., manufactures a single product in which variable manufacturing overhead is assigned on the basis of standard direct labor-hours. The company uses a standard cost system and has established the following standards for one unit of product: Standard Quantity Standard Price or Rate Standard Cost Direct materials 7.50 pounds $ .80 per pound $ 6.00 Direct labor 0.70 hours $ 50.50 per hour $ 35.35 Variable manufacturing overhead 0.70 hours $ 10.20 per hour $ 7.14 During March, the following activity was recorded by the company: The company produced 4,100 units during the month. A total of 21,100 pounds of material were purchased at a cost of $15,280. There was no beginning inventory of materials on hand to start the month; at the end of the month, 5,320 pounds of material remained in the warehouse. During March, 1,260 direct labor-hours were worked at a rate of $47.50 per hour. Variable manufacturing overhead costs during March totaled $15,761. The direct materials purchases variance is computed when the materials are purchased. The variable overhead rate variance for March is:

Multiple Choice

• $2,909 F

• $4,021 U

• $4,021 F

• $2,909 U