Task: Variable Overhead Performance Report with Just a Spending Variance
Jessel Corporation bases its variable overhead performance report on the actual direct labor-hours of the period. Data concerning the most recent year that ended on December 31 are as follows:
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Budgeted direct labor-hours
|
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42,000
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Actual direct labor-hours
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44,000
|
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Standard direct labor-hours allowed
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45,000
|
|
Cost formula (per direct labor-hour):
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|
|
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Indirect labor
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$
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0.90
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|
Supplies
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$
|
0.15
|
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Electricity
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$
|
0.05
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|
Actual costs incurred:
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|
|
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Indirect labor
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$
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42,000
|
|
Supplies
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$
|
6,900
|
|
Electricity
|
$
|
1,800
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Required:
Compute the variable overhead spending variances. (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Input all amounts as positive values. Omit the "$" sign in your response.)
Overhead Costs Spending Variance
Indirect labor
Supplies
Electricity
Total variable over head cost