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Puvo, Incorporated, manufactures a single product in which variable manufacturing overhead is assigned on the...

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Puvo, Incorporated, manufactures a single product in which variable manufacturing overhead is assigned on the basis of standard direct labor hours. The company uses a standard cost system and has established the following standards for one unit of product: Direct materials Direct labor Variable manufacturing overhead Standard Quantity 7.80 pounds 0.40 hours 0.40 hours Standard Price or Rate $ 1.10 per pound $ 53.50 per hour $ 10.50 per hour Standard Cost $ 8.58 $ 21.40 $ 4.20 During March the following activity was recorded by the company . The company produced 4.400 units during the month. . A total of 21.400 pounds of material were purchased at a cost of $15,580. . There was no beginning inventory of materials on hand to start the month at the end of the month, 5,620 pounds of materjal remained in the warehouse. . During March, 1.290 direct labor-hours were worked at a rate of $50.50 per hour. Variable manufacturing overhead costs during March totaled $16,061, The direct materials purchases variance is computed when the materials are purchased. The variable overhead rate variance for March is: Multiple Choice $2,516 Favorable $3,161 Unfavorable $2,516 Unfavorable $3,161 Favorable

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