Jessel Corporation bases its variable overhead performance report on the actual direct labor hours of the period. Data concerning the most recent year that ended on December 31 are as follows:
Budgeted direct labor hours . . . . . . . . . . . . . 42,000
Actual direct labor hours . . . . . . . . . . . . . . . . 44,000
Standard direct labor hours allowed . . . . . . . 45,000
Cost formula (per direct labor hour):
Indirect labor . . . . . . . . . . . . . . . . . . . . . . . . $0.90
Supplies . . . . . . . . . . . . . . . . . . . . . . . . . . . . $0.15
Electricity . . . . . . . . . . . . . . . . . . . . . . . . . . $0.05
Actual costs incurred:
Indirect labor . . . . . . . . . . . . . . . . . . . . . . . $42,000
Supplies . . . . . . . . . . . . . . . . . . . . . . . . . . . . $6,900
Electricity . . . . . . . . . . . . . . . . . . . . . . . . . . . $1,800
Required:
Prepare a variable overhead performance report using the format in Exhibit 11–6. Compute just the variable overhead spending variances; do not compute the variable overhead efficiency variances.