Kartman Corporation makes a product with the following standard costs:
Standard Quantity...
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Kartman Corporation makes a product with the following standard costs:
Standard Quantity Standard Price Standard Cost/Unit
Direct materials 6.7 pounds $ 7.20 per pound $ 48.24
Direct labor 0.6hours $26.00 per hour $ 15.60
Variable overhead 0.6 hours $4.20 per hour $ 2.52
In June the company's budgeted production was 5,200 units but the actual production was 5,300 units. The company used 23,950 pounds of the direct material and 2,470 direct labor-hours to produce this output. During the month, the company purchased 27,200 pounds of the direct material at a cost of $188,180. The actual direct labor cost was $58,821 and the actual variable overhead cost was $13,431.
The company applies variable overhead on the basis of direct labor-hours. The direct materials purchases variance is computed when the materials are purchased.
The variable overhead rate variance for June is:
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