Ask Question
22 February, 05:38

Doogan Corporation makes a product with the following standard costs: Standard Quantity or Hours Standard Price or Rate Direct materials 8.4 grams $ 3.00 per gram Direct labor 0.5 hours $ 30.00 per hour Variable overhead 0.5 hours $ 8.00 per hour The company produced 6,200 units in January using 40,310 grams of direct material and 2,480 direct labor-hours. During the month, the company purchased 45,400 grams of the direct material at $2.70 per gram. The actual direct labor rate was $29.30 per hour and the actual variable overhead rate was $7.80 per hour. The company applies variable overhead on the basis of direct labor-hours. The direct materials purchases variance is computed when the materials are purchased. The variable overhead rate variance for January is:

+1
Answers (1)
  1. 22 February, 05:45
    0
    Variable manufacturing overhead rate variance = $496 favorable

    Explanation:

    Giving the following information:

    Standard:

    Variable overhead 0.5 hours $ 8.00 per hour

    The company produced 6,200 units using 2,480 direct labor-hours. The actual variable overhead rate was $7.80 per hour.

    To calculate the variable overhead rate variance, we need to use the following formula:

    Variable manufacturing overhead rate variance = (standard rate - actual rate) * actual quantity

    Variable manufacturing overhead rate variance = (8 - 7.8) * 2,480

    Variable manufacturing overhead rate variance = $496 favorable
Know the Answer?
Not Sure About the Answer?
Find an answer to your question 👍 “Doogan Corporation makes a product with the following standard costs: Standard Quantity or Hours Standard Price or Rate Direct materials ...” in 📗 Business if the answers seem to be not correct or there’s no answer. Try a smart search to find answers to similar questions.
Search for Other Answers