Is this answer correct? Majer Corporation makes a product with the following sta

Question

Is this answer correct?

Majer Corporation makes a product with the following standard costs Standard Cost Per Standard Quantity or Hours Standard Price or Rate $ 2.00 per ounce $ 16.00 per hour $ 2.00 per hour Unit Direct materials Direct labor Variable overhead 6.4 ounces 0.6 hours 0.6 hours $12.80 $ 9.60 $ 1.20 The company reported the following results concerning this product in February Originally budgeted output Actual output Raw materials used in production Actual direct labor-hours Purchases of raw materials Actual price of raw materials Actual direct labor rate Actual variable overhead rate 5,700 units 5,100 units 31,000 ounces 2,000 hours 33,400 ounces $112.90 per ounce $ 122.40 per hour $ 1.10 per hour

Explanation / Answer

Variable overhead rate variance = (Standard rate-actual rate)actual hours

= (2-1.1)*2000

Variable overhead rate variance = 1800 F

so answer is a) $1800 F

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