Rondell Company uses a standard cost system. Indirect costs were budgeted at $200,000 plus $15 per direct labour hour. The overhead rate is based on 10,000 hours. Actual results were:
Standard direct labour hours allowed..............9,000
Actual direct labour hours..........................10,000
Fixed overhead....................................$190,000
Variable overhead.................................$185,000
Instructions
(a) Calculate the fixed overhead production volume variance.
(b) Calculate the variable overhead spending variance.
(c) Calculate the variable overhead efficiency variance.
(d) Calculate the over- or under-applied overhead.