For May, Mariana company planned production of 10,400 units (80% of its production capacity of 13,000 units) and prepared the following overhead budget. The company applies overhead with a standard of 3 DLH per unit and a standard overhead rate of $3.79 per DLH. 80% Operating Level 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 10,400 $ 18,720 31,200 7,800 2,808 60,528 19,500 13,000 25,220 57,720 $ 118,248 It actually operated at 90% capacity (11,700 units) in May and incurred the following actual overhead. Indirect materials Indirect labor Power Maintenance Actual Overhead Costs $ 18,720 34,000 8,775 5,800 19,500 13,000 28,000 $ 127,795 Rent of building Depreciation-Machinery Supervisory salaries Actual total overhead 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 11,700 units.