Huber Corporation makes a product with the following standard costs:
Standard Quantity or Hours Standard Price or Rate Standard Cost Per Unit
Direct materials 6.6 ounces $ 3.00 per ounce $ 19.80
Direct labor 0.3 hours $ 10.00 per hour $ 3.00
Variable overhead 0.3 hours $ 5.00 per hour $ 1.50
The company reported the following results concerning this product in June.
Originally budgeted output 2,000 units
Actual output 2,500 units
Raw materials used in production 19,000 ounces
Purchases of raw materials 15,000 ounces
Actual direct labor-hours 510 hours
Actual cost of raw materials purchases $ 40,000 Actual direct labor cost $ 12,000 Actual variable overhead cost $ 3,000 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:
$462 U
$450 U
$462 F