Vitko Corporation makes automotive engines.For the most recent month,budgeted production was 6,000 engines.The standard power cost is $8.80 per machine-hour.The company's standards indicate that each engine requires 6.1 machine-hours.Actual production was 6,400 engines.Actual machine-hours were 38,730 machine-hours.Actual power cost totaled $350,628.
Required:
Determine the rate and efficiency variances for the variable overhead item power cost and indicate whether those variances are unfavorable or favorable.Show your work!

Question

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The Answer of Vitko Corporation makes automotive engines.For the most recent month,budgeted production was 6,000 engines.The standard power cost is $8.80 per machine-hour.The company's standards indicate that each engine requires 6.1 machine-hours.Actual production was 6,400 engines.Actual machine-hours were 38,730 machine-hours.Actual power cost totaled $350,628.
Required:
Determine the rate and efficiency variances for the variable overhead item power cost and indicate whether those variances are unfavorable or favorable.Show your work!

Vitko Corporation Makes Automotive Engines