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This year the company had the following standards:
Variable overhead application rate: $4 per direct labour hour
Standard direct labour hours per unit: 2 hours
Fixed overhead application rate: $6 per direct labour hour
The company also had the following actuals:
Production: 16,000 units
Variable overhead: $141,312
Fixed overhead: $203,136
Total direct labour hours: 36,800
Problem 1: What is the variable overhead spending variance?
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During March 2019, During March, 11,000 hours were actually worked. Use this information to determine the standard overhead rate.
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