To calculate the variable overhead efficiency variance, we follow this formula:

$\text{Variable Overhead Efficiency Variance} = (\text{Actual Hours} - \text{Standard Hours Allowed}) \times \text{Standard Variable Overhead Rate}$

Step 1: Gather Data

From the question:

• Actual direct labor-hours = 1,910 hours
• Standard variable overhead rate = $2.00 per hour
• Actual output = 3,000 units
• Standard hours per unit = 0.7 hours/unit

Step 2: Calculate Standard Hours Allowed

$\text{Standard Hours Allowed} = \text{Actual Output} \times \text{Standard Hours per Unit}$ $\text{Standard Hours Allowed} = 3,000 \times 0.7 = 2,100 \, \text{hours}$

Step 3: Calculate the Variance

$\text{Variable Overhead Efficiency Variance} = (1,910 - 2,100) \times 2.00$ $\text{Variable Overhead Efficiency Variance} = (-190) \times 2.00 = -380 \, \text{(Unfavorable)}$

Final Answer:

The Variable Overhead Efficiency Variance for July is $380 Unfavorable (U).

Would you like me to calculate other variances or explain this further?

Here are 5 related questions you might consider:

1. What is the direct materials price variance for this scenario?
2. How is the direct labor efficiency variance computed using similar data?
3. How does the company’s actual variable overhead compare to the budgeted amount?
4. What does the "Unfavorable" variance signify in terms of efficiency?
5. Can the variances for direct materials, labor, and overhead help identify root causes of inefficiency?

Tip: Always compare actual and standard hours, rates, or prices to quickly assess variances in performance reports.