Pohl Corporation uses a standard cost system in which manufacturing overhead is applied on the basis of standard machine-hours. For June, the company's manufacturing overhead flexible budget showed the following total budgeted costs at a denominator activity level of 20,000 machine-hours: During June, 17,000 machine-hours were used to complete 13,000 units of product, and the following actual total overhead costs were incurred: At standard, each unit of finished product requires 1.4 hours of machine time. The variable overhead efficiency variance for utilities cost for June was:
A)$400 F
B)$400 U
C)$600 F
D)$600 U

Question

Pohl Corporation uses a standard cost system in which manufacturing overhead is applied on the basis of standard machine-hours. For June, the company's manufacturing overhead flexible budget showed the following total budgeted costs at a denominator activity level of 20,000 machine-hours:  During June, 17,000 machine-hours were used to complete 13,000 units of product, and the following actual total overhead costs were incurred:  At standard, each unit of finished product requires 1.4 hours of machine time. The variable overhead efficiency variance for utilities cost for June was:
A)$400 F 
B)$400 U 
C)$600 F 
D)$600 U

Quizplus · Accepted Answer

The Answer of Pohl Corporation uses a standard cost system in which manufacturing overhead is applied on the basis of standard machine-hours. For June, the company's manufacturing overhead flexible budget showed the following total budgeted costs at a denominator activity level of 20,000 machine-hours:  During June, 17,000 machine-hours were used to complete 13,000 units of product, and the following actual total overhead costs were incurred:  At standard, each unit of finished product requires 1.4 hours of machine time. The variable overhead efficiency variance for utilities cost for June was:
A)$400 F 
B)$400 U 
C)$600 F 
D)$600 U

Pohl Corporation Uses a Standard Cost System in Which Manufacturing