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

View the information.

Deluxe Fender allocates manufacturing overhead to production based on standard direct labor hours. Deluxe Fender reported the following actual results for $2025$: actual number of fenders produced,

$20,000$ ; actual variable overhead, $$5,700$; actual fixed overhead, $$25,000$; actual direct labor hours, $370.$

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.

Begin with the variable overhead cost and efficiency variances. Select the required formulas, compute the variable overhead cost and efficiency variances. $($You may need to simply the formula based on the

data provided. Abbreviations used: $AC=$ actual cost; $AQ=$ actual quantity; FOH$=$ fixed overhead; $SC=$ standard cost; SQA$=$ standard quantity allowed; VOH$=$ variable overhead. Label the variance as

favorable $($F$)$ or unfavorable $($U$),$ in the input field after the amount you enter.$)$

Information

Requirements

Compute the overhead variances for the year: variable overhead cost variance,

variable overhead efficiency variance, fixed overhead cost variance, and fixed

overhead volume variance.

Explain why the variances are favorable or unfavorable.