21 Question 5-Ch-10 Cagney Company applies overhead to the single product it manufactures on the basis of standard direct labour-hours (DLH). Each unit of product is expected to require 4 direct labour-hours and 10 kg of direct materials. The variable overhead application rate is $S/DLH. The standard hourly wage rate is $25, the standard overhead cost per unit is $30, and the standard price per kilogram of direct materials is $6. T monthly overhead cost in the flexible budget is predicted by the following cost equation: otal $15,000+ $20 x Quantity of production During September, the company produced 1,200 units using 5,200 DLH and 12,500 kg of direct materials It incurred overhead costs of $41,000, of which $26,000 was variable overhead. There was 2,000 kg of direct materials in inventory at the beginning of September and the company purchased 10,500 kg of direct materials for $65,000. Cagney's average wage rate in September was $26.65 per hour Required 12 a. Calculate the following variances: i) Materials price variance ii) Materials quantity variance iii) Labour rate variance iv) Variable overhead spending variance v) Variable overhead efficiency variance 9 b. Calculate the fixed overhead volume variance