Problem: Budgeted production was 2,900 engines. The standard power cost is $2.00 per machine-hour. The company's standards indicate that each engine requires 10.7 machine-hours. Actual production was 3,200 engines. Actual machine-hours were 32,960 machine-hours. Actual power cost totaled $69,665.
What is the rate and efficiency variances for the variable overhead item power cost and indicate whether those variances are unfavorable or favorable.
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