Question

Outdoor Gear Corporation manufactured 1,000 coolers during October. The following variable overhead data relates to October: Variable overhead spending variance $1,300 Unfavorable Variable overhead efficiency variance $182 Unfavorable Budgeted machine hours allowed for actual output 608 machine hours Actual cost per machine hour $28 Budgeted cost per machine hour $26Calculate the variable overhead flexible-budget variance. $1,118 favorable $1,118 unfavorable $1,482 unfavorable $1,482 favorable

Answer 1

Answer:

$1,482 unfavorable

Explanation:

Calculation to determine the variable overhead flexible-budget variance

Using this formula

Variable overhead flexible-budget variance=Variable overhead spending variance Unfavorable + Variable overhead efficiency variance Unfavorable

Let plug in the formula

Variable overhead flexible-budget variance=$1,300 (U) + $182 (U)

Variable overhead flexible-budget variance= $1,482 (U)

Therefore the variable overhead flexible-budget variance is $1,482 unfavorable