Question text Lance Production Company has the following information: Standard fixed factory overhead rates per direct...
Question text
Lance Production Company has the following information:
|
Standard fixed factory overhead rates per direct labor-hour |
$1.50 |
|
Standard variable factory overhead rates per direct labor-hour |
$5.00 |
|
Actual number of units produced |
6,000 units |
|
Actual factory overhead costs (includes $70,000 fixed) |
$78,000 |
|
Actual direct labor hours |
6,000 hours |
Standard factory overhead rates are based on a normal monthly
volume of 5,000 units (1 standard direct labor-hour per
unit).
What is Lance's variable overhead efficiency variance?
Select one:
A. $3,000 (F)
B. $4,000 (F)
C. $-0-
D. $6,000 (U)
Homework Answers
Answer:-The correct option is C.$-0-.
Explanation:-
Variable Overhead Efficiency Variance= (Standard Hour-Actual Hour)* Standard Variable Overhead Rate
=((6,000 units *1)-6,000 hours) *$5
=0*$5
=$0
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