Variable manufacturing overhead, variance analysis. Esquire Clothing is a manufacturer of designer suits. The cost of each suit is the sum of three variable costs (direct materials costs, direct manufacturing labour costs, and manufacturing overhead costs) and one fixed-cost category (manufacturing overhead costs). Variable manufacturing overhead cost is allocated to each suit based on budgeted direct manufacturing labour-hours (DMLH) per suit. For June 2010, each suit is budgeted to take 4 labour-hours. Budgeted variable manufacturing overhead costs per labour-hour are $12.00. The budgeted number of suits to be manufactured in June 2010 is 1,040. Actual variable manufacturing overhead costs in June 2010 were $52,164 for 1,080 suits started and completed. There was no beginning or ending inventory of suits. Actual direct manufacturing labour-hours for June were 4,536 DMLH. REQUIRED 1. Compute the flexible-budget variance, the spending variance, and the efficiency variance for variable manufacturing overhead. 2. Comment on the results.

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