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The Albright Company uses standard costing and has established the following standards for its single product: Direct Materials 2 litres at $3 per litre Direct
The Albright Company uses standard costing and has established the following standards for its single product:
Direct Materials | 2 litres at $3 per litre |
Direct Labour | 0.5 hours at $8 per hour |
Variable Manufacturing Overhead | 0.5 hours at $2 per hour |
During November, the company made 4,000 units and incurred the following costs:
Direct Materials Purchased | 8,100 litres at $3.10 per litre |
Direct Materials Used | 7,600 litres |
Direct Labour Used | 2,200 hours at $8.25 per hour |
Actual Variable Manufacturing Overhead | $4,175 |
The company applies variable manufacturing overhead to products on the basis of direct labour hours. What was the total variable overhead variance for November?
Question options:
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$175 unfavourable.
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$225 favourable.
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$225 unfavourable.
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$400 unfavourable.
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