Gerhan Company's flexible budget for the units manufactured in May shows $15,720 of total factory...
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Accounting
Gerhan Company's flexible budget for the units manufactured in May shows $15,720 of total factory overhead; this output level represents 70% of available capacity. During May, the company applied overhead to production at the rate of $3.00 per direct labor hour (DLH), based on a denominator volume level of 6,120 DLHs, which represents 90% of available capacity. The company used 6,000 DLHs and incurred $18,500 of total factory overhead cost during May, including $7,600 for fixed factory overhead.
What is the factory overhead efficiency variance (to the nearest whole dollar) for May under the assumption that Gerhan uses a four-variance breakdown (decomposition) of the total overhead variance? (Round your intermediate calculation to 2 decimal places.)
A. 2106 U
B. 2306 F
C. 2306 U
D. 2406 U
E. 3406 F
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