The following information relates to Tablerock Manufacturing's overhead costs for the month:
Tablerock allocates variable manufacturing overhead to production based on standard direct labor hours.
Tablerock reported the following actual results for last month: actual variable overhead, $14,500; actual fixed overhead, $5,400; actual production of 4,700 units at 0.22 direct labor hours per unit. The standard direct labor time is 0.20 direct labor hours per unit.
Compute the variable overhead cost variance. (Round intermediate calculations to two decimal places and the answer to the nearest dollar.)
Variable overhead cost variance: (AC - SC) × AQ = ($14.02 - $14.20) × 1,034 = 186 F
* Standard VOH allocation rate: Budgeted VOH / Budgeted allocation base
$14,200 / 1,000 = $14.20 per DL Hr
** 4,700 units produced × 0.22 actual direct labor hours per unit =1,034 DLHr
***AC = $14,500/(4,700 × 0.22) = $14.02
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