The following data have been provided by Wordell Corporation:
-The variable overhead rate variance for indirect labor is closest to:
A) $3,004 U
B) $2,761 U
C) $3,004 F
D) $243 F

Question

The following data have been provided by Wordell Corporation: 
-The variable overhead rate variance for indirect labor is closest to:
A) $3,004 U 
B) $2,761 U 
C) $3,004 F 
D) $243 F

Quizplus · Accepted Answer

The variable overhead rate variance is calculated as the difference between the actual variable overhead costs incurred and the standard costs that should have been incurred based on the actual hours worked. The choice $3,004 U indicates an unfavorable variance, meaning the actual costs were higher than the standard costs.

The Following Data Have Been Provided by Wordell Corporation