Reference no: EM132572081

Systems Controls, which manufactures industrial switches, uses a standard-costing system. The standard manufacturing overhead (MOH) costs assigned per switch are based on direct-labor hours (DLH) as follows:

Variable MOH (5 DLH @ $8.00 per hour) $40

Fixed MOH (5 DLH @ $12.00 per hour) 60

Total MOH per switch $ 100

Additional information is available for the month of October:

Actual Variable MOH costs were $2,550,000

Actual Fixed MOH costs were $3,750,000

60,000 switches were budgeted to be produced

56,000 switches were actually produced

275,000 DLH were worked at a total direct labor cost of $2,868,250.

Question 1: The variable-overhead spending variance is:

Group of answer choices

Option 1: $310,000 U

Option 2: $350,000 U

Option 3: $318,250 F

Option 4: $350,000 F

Option 5: $40,000 F