Cordon Corporation set the following standard unit costs for its single product: Standard Costs: Cost of material Standard Costs Direct Materials Direct Labor Factory Overhead - Variable Factory Overhead - Fixed Total Standard Costs Materials needed 25 lbs 6 DLH 6 DLH 6 DLH $4.00/1b $8.00/DLH $5.00/DLH $7.00/DLH $100/unit $48/unit $30/unit $42/unit $220/unit The predetermined overhead rate is based on a planned operating volume of 80% of the productive capacity of 60,000 units per quarter. The following flexible budget information is available: Operating Levels 70% 80% 90% Production in units 42,000 48,000 54, Standard direct labor hours 252,000 288,000 324. Budgeted Overhead Variable MOH $ 1,260,000 $ 1,440,000 $ 1.620, Fixed MOH $ 2,016,000 $ 2,016,000 $ 2,016, During the current quarter, the company operated at 70% of capacity and produced 42,000 units of product: direct labor hours worked were 250,000. Actual costs incurred during the current quarter follow: Direct materials (1,000,000) $ 4,250,000 Direct labor (250,000) 1,937,500 Fixed factory overhead costs 1,960,000 Variable factory overhead costs 1,200,000 Total actual costs $ 9,347,500 3) Prepare the Variable Overhead Spending and Efficiency variances 4) Put together a story about what happened with the company costs this year (i.e. why are the variances the way they are)