Question

financial data related to a company's unit production for the current month are as follows: standard overhead hours for production of 15,000 units 20,000 hours. actual unit production 15,000 units. actual variable factory overhead $475,000 actual fixed factory overhead $50,000 standard unit total overhead cost per hour $30 standard fixed factory overhead per hour $3 what amount is the company's variable factory overhead variance for the current month?

Answer 1

Answer: $65,000

Explanation: $30 (standard unit total overhead cost per hour) - $3 (standard fixed factory overhead per hour) = $27

$27*20,000 (standard overhead hours for production of 15,000) = $540,000

$475,000 (actual variable factory overhead) - $540,000 = $65,000