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		5.90	pounds	$	0.70	per pound	$	4.13
Direct labor		0.50	hours	$	34.50	per hour	$	17.25
Variable manufacturing overhead		0.50	hours	$	8.60	per hour	$	4.30

During March, the following activity was recorded by the company:

• The company produced 2,500 units during the month.
• A total of 19,500 pounds of material were purchased at a cost of $13,680.
• There was no beginning inventory of materials on hand to start the month; at the end of the month, 3,720 pounds of material remained in the warehouse.
• During March, 1,100 direct labor-hours were worked at a rate of $31.50 per hour.
• Variable manufacturing overhead costs during March totaled $14,161.

The direct materials purchases variance is computed when the materials are purchased.

The variable overhead rate variance for March is:

Multiple Choice

• $4,701 F

• $5,046 U

• $5,046 F

• $4,701 U