The Chilton Corporation Specializes in Manufacturing One Type of Desk

Multiple Choice

The Chilton Corporation specializes in manufacturing one type of desk lamp. Chilton allocates variable manufacturing overhead costs on the basis of machine hours. Chilton budgeted 0.3 machine hours per lamp and allocates overhead at a rate of $1.90 per machine hour. Last year Chilton manufactured 19,000 lamps, used 7,600 machine hours and incurred actual overhead costs of $12,920. What was Chilton's variable manufacturing overhead efficiency variance last year?

A) $3,610 favorable
B) $3,610 unfavorable
C) $1,520 favorable
D) $1,520 unfavorable