Question: i know how to solve for the answer i just need clarification on how to know if its favorable or unfavorable. specifically for finding variable
Puvo, incorporated, manufactures a single product in which variable manufacturing overhead is assigned on the basis of standard direct labor-hours. The company uses a standard cost system and has established the following standards for one unit of product: Standard Quantity Direct materials 5.8 pounds Direct labor 0.5 hours Variable manufacturing overhead 0.5 hours During March the following activity was recorded by the company: Standard Price or Rate $ 0.60 per pound $ 33.50 per hour $ 8.50 per hour Standard Cost $ 3.48 $ 16.75 $ 4.25 The company produced 2,400 units during the month A total of 19,400 pounds of material were purchased at a cost of $13,580 There was no beginning inventory of materials on hand to start the month; at the end of the month. 3,620 pounds of material remained in the warehouse. . During March, 1,090 direct labor-hours were worked at a rate of $30.50 per hour. Variable manufacturing overhead costs during March totaled $14,061 The direct materials purchases variance is computed when the materials are purchased The variable overhead efficiency variance for March is
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