Question
Zacher Corporation makes a product with the following standards for direct labor and variable overhead: Standard quantity or hours Standard price or rate Standard cost
Zacher Corporation makes a product with the following standards for direct labor and variable overhead: Standard quantity or hours Standard price or rate Standard cost per unit
Direct labor 0.3 hours $24.00 per hour $7.20
Variable overhead 0.3 hours $5.00 per hour $1.50 In February the company's budgeted production was 6,900 units, but the actual production was 7,000 units. The company used 1,980 direct labor-hours to produce this output. The actual variable overhead cost was $10,296. The company applies variable overhead on the basis of direct labor-hours. The variable overhead rate variance for February is:
| $420 U | |
| $420 F | |
| $396 F | |
| $396 U |
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