Tharaldson Corporation makes a product with the following standard costs:

Standard Quantity or HoursStandard Price or RateStandard Cost Per UnitDirect materials6.9ounces$2.00per ounce$13.80Direct labor0.4hours$13.00per hour$5.20Variable overhead0.4hours$5.00per hour$2.00

The company reported the following results concerning this product in June.

Originally budgeted output2,300unitsActual output2,800unitsRaw materials used in production20,500ouncesPurchases of raw materials23,000ouncesActual direct labor-hours540hoursActual cost of raw materials purchases$42,000Actual direct labor cost$12,300Actual variable overhead cost$3,400

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 June is:

Multiple Choice

• $712 U
• $712 F
• $700 F
• $700 U