For May, Mariana company planned production of 10,000 units (80% of its production capacity of 12,500 units) and prepared the following overhead budget. The company applies overhead with a standard of 2 DLH per unit and a standard overhead rate of $4 per DLH. 80% Operating Level 10,000 Overhead Budget Production (in units) Budgeted overhead Variable overhead costs Indirect materials Indirect labor Power Maintenance Total variable overhead costs Fixed overhead costs Rent of building Depreciation-Machinery Supervisory salaries Total fixed overhead costs Total overhead $ 12,000 20,000 5,000 3,000 40,000 19,000 10,400 14,600 44,000 $ 84,000 It actually operated at 90% capacity (11,250 units) in May and incurred the following actual overhead. Actual Overhead Costs Indirect materials Indirect labor Power Maintenance Rent of building Depreciation-Machinery Supervisory salaries Actual total overhead $ 12,000 22,200 5,625 3,990 19,000 10,400 17,600 $ 90,815 1. Compute the overhead controllable variance and identify it as favorable or unfavorable. 2. Compute the overhead volume variance and identify it as favorable or unfavorable. 3. Prepare an overhead variance report at the actual activity level of 11,250 units. Answer is not complete. Complete this question by entering your answers in the tabs below. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Compute the overhead controllable variance and identify it as favorable or unfavorable. (Indicate the effect of the variance by selecting favorable, unfavorable, or no variance.) Controllable variance $ 90,815 Actual total overhead Budgeted (flexible) overhead Fixed overhead Variable overhead Controllable variance $ 44,000 45,000 89,000 1,815 S Unfavorable Required 1 Required 2 > Required 1 Required 2 Required 3 Compute the overhead volume variance and identify it as favorable or unfavorable. (Indicate the effect of the variance by selecting favorable, unfavorable, or no variance. Do not round intermediate calculations.) Volume Variance Standard overhead applied s 44,000 Actual total overhead 49,500 Volume variance S 5,500 Favorable Required 1 Required 2 Required 3 Prepare an overhead variance report at the actual activity level of 11,250 units. (Indicate the effect of each variance by selecting favorable, unfavorable, or no variance. Do not round intermediate calculations.) MARIANA COMPANY Overhead Variance Report For Month Ended May 31 Expected 80% of capacity Actual 90% of capacity Volume variance $ 5,500 Favorable Controllable Variance Flexible Budget Actual Variances Results Favorable/Unfavorable Variable overhead costs: Indirect materials 13,500 $ 12,000 1,500 Favorable Indirect labor 24,975 22,200 2,775 Favorable Power 5,625 5,625 No variance Maintenance 4,489 3,990 Unfavorable 48,589 43,815 Total variable overhead costs Fixed overhead costs: Rent of building Depreciation Machinery Supervisory salaries 19,000 10,400 17,600 19,000 10,400 17,600 0 No variance 0 No variance 0X No variance >>X Unfavorable 47,000 95,589 47,000 90,815 S IS Total fixed overhead costs Total overhead costs Volume Variance Standard overhead applied Budgeted (flexible) overhead Volume variance Total overhead variance Favorable Favorable