Russo Corporation manufactured 17000 air conditioners during

Russo Corporation manufactured 17,000 air conditioners during November. The overhead cost-allocation rate is $35.50 per machine-hour. The following variable overhead data pertain to November Actual 17,000 units 8,325 hours 35.00 Budgeted Production Machine-hours Variable overhead cost per machine-hour 19,000 units 9,500 hours 35.50 What is the variable overhead efficiency variance? OA. $4750.00 unfavorable B. $6212.50 unfavorable OC. $4,750.00 favorable O D. $6.212.50 favorable

Solution

Standard machine hours = 9500/19000*17000= 8500 Variable overhead efficiency variance = 35.5*(8325-8500)= $6212.50 Favorable