Richmond Labs manufactures a product that relieves arthritis pain. The product, available in a lotion or spray, is distributed nationwide. Richmond Labs has established the following standards for costing its product: Direct materials: 2.5 ounces at $20 per ounce Direct labor: 1.4 hours at $12.50 per hour Variable manufacturing overhead: 1.4 hours at 3.50 per hour Variable manufacturing overhead is applied on the basis of standard direct labor-hours. The following data are available for October . 3.750 units of compound were produced during the month. There was no beginning direct materials inventory. Direct materials purchased: 12.000 ounces for $225,000 The ending direct materials inventory was 2.000 ounces. Direct labor-hours worked: 5,600 hours at a cost of 567,200. Variable manufacturing overhead costs incurred amounted to $18.200 Variable manufacturing overhead applied to products: 518.375, The variable overhead rate variance for October is: $3,750 Favorable $4.375 Unfavorable $1,900 Unfavorable $1,400 Favorable