Blaze Corp. applies overhead on the basis of direct labor hours. For the month of March, the company planned production of 10,000 units (80% of its production capacity of 12,500 units) and prepared the following budget.

	Operating Levels
Overhead Budget	80%
Production in units		10,000
Standard direct labor hours		20,000
Budgeted overhead
Variable overhead costs
Indirect materials	$	18,200
Indirect labor		14,000
Power		4,000
Maintenance		1,800
Total variable costs		38,000
Fixed overhead costs
Rent of factory building		12,000
DepreciationMachinery		20,000
Taxes and insurance		2,800
Supervisory salaries		13,200
Total fixed costs		48,000
Total overhead costs	$	86,000

During March, the company operated at 90% capacity (11,250 units), and it incurred the following actual overhead costs.

Overhead costs (actual)
Indirect materials	$	18,200
Indirect labor		14,000
Power		4,500
Maintenance		2,750
Rent of factory building		12,000
DepreciationMachinery		18,500
Taxes and insurance		3,500
Supervisory salaries		14,200
Total actual overhead costs	$	87,650

1. Compute the overhead controllable variance. 2. Compute the overhead volume variance. 3. Prepare an overhead variance report at the actual activity level of 9,000 units.