The following data for the Recycle Company pertain to the production of 1,000 bottles during August: Standard variable overhead cost: $26.00 per pound of glass. Total actual variable overhead cost: $24,800.
Standard variable overhead cost allowed for units produced was $26,000. Variable overhead efficiency variance was $540 unfavorable.
Is the variable overhead flexible- budget variance.
A) $2,280 favorable
B) $1,200 unfavorable
C) $540 unfavorable
D) $1,200 favorable

Question

Quizplus · Accepted Answer

The flexible-budget variance is the difference between the actual variable overhead cost and the standard variable overhead cost allowed. Here, it is $24,800 (actual) - $26,000 (standard allowed) = $1,200 favorable.

The Following Data for the Recycle Company Pertain to the Production