Question

Given the data excerpts from Vitex, Incorporated's standard cost system and the reported total variances for direct materials, direct labor, and variable manufacturing overhead, where the total standard cost per unit is $59.66, the total variances for direct materials, direct labor, and variable manufacturing overhead are $522,900 (with $9,715 favorable for price or rate and $33,200 unfavorable for quantity or efficiency), $232,500 ($3,200 unfavorable for price or rate, and $15,500 unfavorable for quantity or efficiency), and $139,500 (with $4,700 favorable for price or rate and an unknown amount for quantity or efficiency), respectively, what is the missing quantity or efficiency variance for variable manufacturing overhead?

Answer 1

The missing quantity or efficiency variance for variable manufacturing overhead is calculated by subtracting the known favorable price or rate variance of $4,700 from the total variance of $139,500, resulting in an unfavorable variance of $134,800.

Step-by-step explanation:

The student is dealing with a standard cost variances problem in cost accounting, which is part of a business curriculum. Specifically, they are asked to find the missing quantity or efficiency variance for variable manufacturing overhead. The information given includes a total variance for variable manufacturing overhead of $139,500 and a favorable price or rate variance of $4,700. To find the missing quantity or efficiency variance, we subtract the known favorable variance from the total variance.

The calculation process is as follows:

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Missing Quantity or Efficiency Variance = $139,500 - $4,700 = $134,800 Unfavorable.

This means that the missing quantity or efficiency variance for variable manufacturing overhead is an unfavorable variance of $134,800.