Shumaker Company manufactures a line of high-top basketball shoes. At the beginning of the year, the following plans for production and costs were revealed:

Pairs of shoes to be produced and sold 55,000 Standard cost per unit: lop5 Direct materials $15 Direct labor 2 Variable overhead 6 Fixed overhead oe Total unit cost $36 During the year, 50,000 units were produced and sold. The following actual costs were incurred:

Direct materials $775,000 Direct labor 590,000 Variable overhead 310,000 Fixed overhead 180,000 There were no beginning or ending inventories of raw materials. The materials price variance was $5,000 unfavorable. In producing the 50,000 units, 63,000 hours were worked, 5 percent more hours than the standard allowed for the actual output. Overhead costs are applied to production using direct labor hours.

Required:

1. Using a flexible budget, prepare a performance report comparing expected costs for the actual production with actual costs.

2. Determine the following:

Materials usage variance Labor rate variance Labor efficiency variance Fixed overhead spending and volume variances

. Variable overhead spending and efficiency variances 3. Use T-accounts to show the flow of costs through the system.