Clark Company's master budget includes $360,000 for equipment depreciation. The master budget was prepared for an annual volume of 120,000 chargeable hours. This volume is expected to occur uniformly throughout the year. During September, Clark performed 9,000 chargeable hours, and the firm reported $28,000 for depreciation expense.

Data
Budgeted equipment depreciation………………………………….	$ 360,000
Budgeted chargable hours………………………………………..	120,000
Actual chargable hours in September……………………………….	9,000
Actual equipment depreciation…………………………………….	$ 28,000

Required

1. Determine the flexible budget amount for equipment depreciation in September.

2. Compute the spending variance for the depreciation expense on equipment.

3. Calculate the fixed overhead production volume variance for depreciation expense. What is the interpretation of this variance?

4. List possible reasons for the spending variance.