Use the following information for the next 4 questions.
Burkett Company uses a standard cost system. Indirect costs were budgeted at $200,000 plus $15 per direct labor hour. The overhead rate is based on 10,000 hours. Actual results were:
-The variable overhead efficiency variance was
A) $10,000 F
B) $50,000 U
C) $35,000 U
D) $15,000 U

Question

Use the following information for the next 4 questions.
Burkett Company uses a standard cost system. Indirect costs were budgeted at $200,000 plus $15 per direct labor hour. The overhead rate is based on 10,000 hours. Actual results were: 
-The variable overhead efficiency variance was
A) $10,000 F 
B) $50,000 U 
C) $35,000 U 
D) $15,000 U

Quizplus · Accepted Answer

The variable overhead efficiency variance is calculated as the difference between the actual hours worked and the standard hours allowed, multiplied by the standard variable overhead rate. The given options suggest that $15,000 U (unfavorable) is the correct variance.

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