Valera Corporation Makes a Product with the Following Standards for Labor

question 115

Multiple Choice

Valera Corporation makes a product with the following standards for labor and variable overhead: The company budgeted for production of 5,300 units in July, but actual production was 5,400 units. The company used 2,130 direct labor-hours to produce this output. The actual variable overhead rate was $6.10 per hour. The company applies variable overhead on the basis of direct labor-hours.
The variable overhead rate variance for July is:

• A) $213 F
• B) $216 F
• C) $216 U
• D) $213 U