Fixed manufacturing overhead, variance analysis (continuation of 8-16). Esquire Clothing allocates fixed manufacturing overhead to each suit using budgeted direct manufacturing labour-hours per suit. Data pertaining to fixed manufacturing overhead costs forJune 2007 are

$74,880, budgeted, and $76,700, actual.

Required 1. Compute the spending variance and the flexible-budget variance for fixed manufacturing overhead. Comment on these results.

2. Compute the production volume variance for June 2007. What inferences can Esquire Clothing draw from this variance?