Deluxe Fender uses a standard cost system and provide the following information:

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Read the requirements.

Requirement $1.$ Compute the overhead variances for the year: variable overhead cost variance, variable overhead efficiency variance, fixed overhead cost variance, and fixed overhead volume variance.

actual cost; $AQ=$ actual quantity; FOH$=$ fixed overhead; $SC=$ standard cost; $SQ=$ standard quantity; VOH$=$ variable overhead.$)$

$SQ=$ standard quantity.$)$

Requirement $2.$ Explain why the variances are favorable or unfavorable.

The variable overhead cost variance is unfavorable because management spent more than budgeted for the actual production.

The variable overhead efficiency variance is $,$ because management used fewer direct labor hours than standard and variable overhead is applied $($incurred$)$ based on direct labor.

The fixed overhead cost variance is unfavorable because management spent more than the amount budgeted for fixed overhead.

The fixed overhead volume variance is unfavorable because management allocated less fixed overhead to jobs than was budgeted.

Data table