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

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Accounting

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:

Standard Quantity Standard Price or Rate Standard Cost
Direct materials 7.0 pounds $ .80 per pound $ 5.60
Direct labor 0.7 hours $ 45.50 per hour $ 31.85
Variable manufacturing overhead 0.7 hours $ 9.70 per hour $ 6.79

During March, the following activity was recorded by the company:

The company produced 3,600 units during the month.

A total of 20,600 pounds of material were purchased at a cost of $14,780.

There was no beginning inventory of materials on hand to start the month; at the end of the month, 4,820 pounds of material remained in the warehouse.

During March, 1,210 direct labor-hours were worked at a rate of $42.50 per hour.

Variable manufacturing overhead costs during March totaled $15,261.

The direct materials purchases variance is computed when the materials are purchased.

The variable overhead rate variance for March is:

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