The Maxwell Corporation has a standard costing system in which variable manufacturing overhead is assigned to production on the basis of standard machine-hours. The following data are available for July:
• Actual variable manufacturing overhead cost incurred: $25,700
• Actual machine-hours worked: 3,000 hours
• Variable overhead rate variance: $5,520 Unfavorable
• Total variable overhead spending variance: $7,700 Unfavorable
The variable overhead efficiency variance for July is:
$13,220 Unfavorable
$13,220 Favorable
$2,180 Unfavorable
$2,180 Favorable