Fletcher Company collected the following data regarding production of one of its products.

-Compute the variable overhead cost variance.
A)$18,000 favorable.
B)$4,000 favorable.
C)$18,000 unfavorable.
D)$18,300 favorable.
E)$14,300 unfavorable.

Question

Fletcher Company collected the following data regarding production of one of its products.

-Compute the variable overhead cost variance. 
A)$18,000 favorable. 
B)$4,000 favorable. 
C)$18,000 unfavorable. 
D)$18,300 favorable. 
E)$14,300 unfavorable.

Quizplus · Accepted Answer

The variable overhead cost variance is calculated as the difference between the actual variable overhead costs and the standard variable overhead costs for the actual level of activity. The $4,000 favorable variance indicates that the actual costs were $4,000 less than the standard costs.

Fletcher Company Collected the Following Data Regarding Production of One