According to ABC Company\'s standards for variable overhead, each unit produced

Question

 According to ABC Company's standards for variable overhead, each unit produced should require 5 direct labor hours to make.  The following information is available for June:  1.  actual variable manufacturing overhead cost incurred during June     totaled $39,000 2.  actual direct labor hours worked during June totaled 4,800 3.  the variable overhead spending variance for June was 4,200 favorable 4.  the total variable overhead variance for June was 10,200 unfavorable  Calculate the number of units produced during June. Enter your answer as a number (i.e., 1,000). Do not use the $, decimals, or type the word units after your answer. 

Explanation / Answer

overhead spending variance = (Actual rate - standard rate)* Ah worked 4,200             = (39000 - 4800*x) x                    = (39000+4200)/4800 9 variable overhead efficiency variance = 14,400U (AH - SH)*SR = 14400 (4800 - SH)*9 = 14400 SH                   = (43200-14400)/9 3200 each unit requires 5 direct labor hours hence actual units produced = 3200/5 640 640 units answer

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