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    Hollowell Audio, Inc. Variable overhead variances

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    Hollowell Audio, Inc., manufactures military-specification compact discs. The company uses standards to control its costs. The labor standards that have been set for one disc are as follows:

    Standard Hours: 6 minutes
    Standard Rate per Hour: $ 24.00
    Standard Cost: $ 2.40

    During July, 2,125 hours of direct labor time were required to make 20,000 discs. The direct labor cost totaled $49,300 for the month.The budgeted variable manufacturing overhead rate is $16.00 per direct labor-hour. During July, the company incurred $39,100 in variable manufacturing overhead cost. Compute the variable overhead efficiency and rate variances for the month.

    Variable overhead efficiency variance -
    Variable overhead rate variance -

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    https://brainmass.com/business/accounting/hollowell-audio-inc-variable-overhead-variances-502355

    Solution Summary

    Your tutorial is attached and includes a chart showing how to map out the amounts and find the variances.

    $2.19

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