Chilczuk, S.A., of Gdansk, Poland, is a major producer of classic Polish sausage. The company uses a standard cost system to help control costs. Manufacturing overhead is applied to production on the basis of standard direct labor-hours. According to the company's flexible budget, the following manufacturing overhead costs should be incurred at an activity level of 16,000 labor-hours (the denominator activity level): 36,000 Variable manufacturing overhead cost Fixed manufacturing overhead cost 68,000 104,000 Total manufacturing overhead cost During the most recent year, the following operating results were recorded: 13,000 14,000 Activity: Actual labor hours worked Standard labor-hours allowed for output Cost: Actual variable manufacturing overhead cost incurred Actual fixed manufacturing overhead cost incurred $41,600 56,000 $ At the end of the year, the company's Manufacturing Overhead account contained the following DO 22 Nav At the end of the year, the company's Manufacturing Overhead account contained the following data: Manufacturing Overhead Actual 97,600 Applied 91,000 6,600 Management would like to determine the cause of the $6,600 underapplied overhead. Required: 1. Compute the predetermined overhead rate. Break the rate down into variable and fixed cost elements. (Round your answers to 2 decimal places.) Predetermined Overhead Rate Total rate per hour per hour Variable element Fixed element per hour 2. Show how the $91,000 Applied figure in the Manufacturing Overhead account was computed. (Round your per hour value to 2 decimal places.) standard hours x per hour 3. Analyze the $6,600 underapplied overhead figure in terms of the variable overhead rate and efficiency variances and the fixed overhead budget and volume variances. (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance).) Variable overhead: Rate variance Efficiency variance Fixed overhead: Budget variance Volume variance