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    mikeyom's Avatar
    mikeyom Posts: 3, Reputation: 1
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    #1

    Oct 26, 2015, 10:18 AM
    What is the variable overhead spending variance for the month?
    The following standards for variable manufacturing overhead have been established for a company that makes only one product:

    Standard hours per unit of output 5.6 hours
    Standard variable overhead rate $12.00 per hour

    The following data pertain to operations for the last month:

    Actual hours worked 2,600 hours
    Actual variable overhead cost $31,330
    Actual output 400 units

    What is the variable overhead spending variance for the month?

    Choose 1 answer
    A. $100 unfavorable
    B. $130 unfavorable
    C. $163 unfavorable
    D. $250 favorable
    smoothy's Avatar
    smoothy Posts: 25,490, Reputation: 2853
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    #2

    Oct 26, 2015, 10:21 AM
    You forgot to cut and paste the work you did and the answer you got as well. Since we don't do your homework for you and you have shown no effort to do it yourself
    mikeyom's Avatar
    mikeyom Posts: 3, Reputation: 1
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    #3

    Oct 26, 2015, 08:35 PM
    This is what I got but it's wrong.

    Spending Variance (AH x AR) - (SH x SR)
    AH = 2,600
    AR = (31330 / 400) = 12.05
    SH = 5.6 x 400 = 2240
    SR = 12

    (2600 x 12.05) - (2240 x 12) = 4450
    paraclete's Avatar
    paraclete Posts: 2,706, Reputation: 173
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    #4

    Oct 27, 2015, 02:46 AM
    The spending variance is the difference between the actual and the standard

    so the actual is 31,330 the standard is 5.6 x 400 x 12 (26880)

    do you think there might be some data missing?
    mikeyom's Avatar
    mikeyom Posts: 3, Reputation: 1
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    #5

    Oct 27, 2015, 08:07 AM
    (2600 x 12.05) - (2240 x 12) = $4,450 Unfavorable.
    However, $4,450 is not one of answer list.

    Choose 1 answer
    A. $100 unfavorable
    B. $130 unfavorable
    C. $163 unfavorable
    D. $250 favorable
    paraclete's Avatar
    paraclete Posts: 2,706, Reputation: 173
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    #6

    Oct 28, 2015, 11:17 PM
    This is why I asked you if there is some data missing
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