Gentile Corporation makes a product with the following standard costs:

Standard Quality or Hours Standard Price or Rate
Inputs
Direct materials 7.5 kilos $9.00 per kilo
Direct labor 1.0 hours $15.60 per hour
Variable overhead 1.0 hours $5.40 per hour

The company produced 6,200 units in May using 37,930 kilos of direct material and 4,500 direct labor hours. During the month, the company purchased 41,540 kilos of the direct material at $6.30 per kilo. The actual direct labor rate was $16.90 per hour and the actual variable overhead rate was $5.10 per hour.

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 efficiency variance for May is:

$8,670 U
$9,180 F
$9,180 U

$8,670 F

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