1. Overhead Variances, Two- And Three-Variance Analyses Oerstman, Inc., uses a standard costing system and develops its overhead rates from the current annual budget. The budget is based on an expected annual output of 121,000 units requiring 484,000 direct labor hours. (Practical capacity is 504,000 hours.) Annual budgeted overhead costs total $759,880, of which $546,920 is fixed overhead. A total of 119,100 units using 482,000 direct labor hours were produced during the year. Actual variable overhead costs for the year were $240,600, and actual fixed overhead costs were $555,900. Required: 1. Compute overhead variances using a two-variance analysis. Budget Variance $fill in the blank 1 39,964 Unfavorable Volume Variance $fill in the blank 3 8,588 Unfavorable 2. Compute overhead variances using a three-variance analysis. Spending Variance $fill in the blank 5 Unfavorable Efficiency Variance $fill in the blank 7 Unfavorable Volume Variance $fill in the blank 9 8,588 Unfavorable

2. Calculating the Variable Overhead Spending and Efficiency Variances Standish Company manufactures consumer products and provided the following information for the month of February: Units produced 131,500 Standard direct labor hours per unit 0.2 Standard variable overhead rate (per direct labor hour) $3.40 Actual variable overhead costs $88,650 Actual hours worked 26,450 Required: 1. Calculate the variable overhead spending variance using the formula approach. (If you compute the actual variable overhead rate, carry your computations out to five significant digits and round the variance to the nearest dollar.) $fill in the blank 1 Favorable