Variable Overhead Variances, Service Company
Rostand Inc. operates a delivery service for over 70restaurants. The corporation has a fleet of vehicles and hasinvested in a sophisticated, computerized communications system tocoordinate its deliveries. Rostand has gathered the followingactual data on last year’s delivery operations:
Deliveries made:
39,800
Direct labor:
31,000 delivery hours @ $9.00
Actual variable overhead:
$156,300
Rostand employs a standard costing system. During the year, avariable overhead rate of $5.20 per hour was used. The laborstandard requires 0.80 hour per delivery.
Required:
Calculate the variable overhead efficiency variance. Round youranswer to the nearest dollar.
Please show all steps.
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