The following data have been provided by Furr Corporation: Indirect labor and power are both elements of variable manufacturing overhead.
The variable overhead rate variance for power is closest to:
A) $7,097 U
B) $7,097 F
C) $896 F
D) $7,993 U

Question

The following data have been provided by Furr Corporation:  Indirect labor and power are both elements of variable manufacturing overhead.
The variable overhead rate variance for power is closest to:
A) $7,097 U 
B) $7,097 F 
C) $896 F 
D) $7,993 U

Quizplus · Accepted Answer

AH × AR = $94,989
Variable overhead rate variance = (AH × AR) − (AH × SR)
= ($94,989) − (62,140 hours × $1.40 per hour)
= $94,989 − $86,996
= $7,993 U

The Following Data Have Been Provided by Furr Corporation