Reference no: EM133011512

Megan Incorporated uses the following standard costs per unit for one of its products: Direct labor (2.0 hours @ $5.00 per hour) = $10.00; Overhead (2.0 hours @ $2.50) = $5.00. The flexible budget for overhead is $120,000 plus $1.00 per direct labor hour (DLH). Actual data for the past month show total overhead costs of $239,000, total fixed overhead of $103,000, 86,000 hours worked, and 40,000 units produced.

Problem 1: The variable overhead spending variance for the past month for Megan Incorporated was:

A.) $0
B.) $36.000 unfavorable
C.) $38,000 unfavorable
D.) $50,000 unfavorable
E.) None of these answers are correct.