Mulliner Company showed the following information for the year:

Standard variable overhead rate (SVOR) per direct labor hour $3.50

Standard hours (SH) allowed per unit 3

Actual production in units 20,000

Actual variable overhead costs $220,500

Actual direct labor hours 61,200

Required:

1. Calculate the standard direct labor hours for actual production.

2. Calculate the applied variable overhead. $

3. Calculate the total variable overhead variance. Enter amounts as positive numbers and select Favorable or Unfavorable.

Question

Business

Stark

22 June, 18:54

Mulliner Company showed the following information for the year:

Standard variable overhead rate (SVOR) per direct labor hour $3.50

Standard hours (SH) allowed per unit 3

Actual production in units 20,000

Actual variable overhead costs $220,500

Actual direct labor hours 61,200

Required:

1. Calculate the standard direct labor hours for actual production.

2. Calculate the applied variable overhead. $

3. Calculate the total variable overhead variance. Enter amounts as positive numbers and select Favorable or Unfavorable.

+2

Answers (1)

Know the Answer?

Kassidy Leblanc · Answer 1

1. 60,000 hours

2. $210,000

3. $10,500 Unfavorable

Explanation:

1. Standard Hours = 3 per unit

Actual production units = 20,000

Standard Hours for actual production = Standard Hours * Actual production units

= 3 * 20,000

= 60,000 hours

2. Applied variable overhead = Standard hours * Standard Rate per hour

= 60,000 * $3.50

= $210,000

3. Total Variable overhead variance = Applied variable overhead - Actual variable overhead overhead

= $210,000 - $220,500

= $10,500 Unfavorable