Derf Corporation uses a standard cost system in which it applies manufacturing overhead on the basis of standard direct labor-hours. Two direct labor-hours are required for each unit produced. The denominator activity was set at 11,400 units. Manufacturing overhead was budgeted at $114,000 for the period; 20 percent of this cost was fixed. The 22,000 hours worked during the period resulted in production of 10,400 units. Variable manufacturing overhead cost incurred was $93,000 and fixed manufacturing overhead cost was $24,000.
The variable overhead efficiency variance for the period was:
a. $1,200 Unfavorable
b. $5,000 Unfavorable
c. $4,800 Unfavorable
d. $2,000 Unfavorable