For May, Mariana company planned production of 16,000 units (80% of its production capacity of 20,000 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 16,000 $ 28,800 48,000 12,000 4,320 93,120 30,000 20,000 38,800 88,800 $181,920 It actually operated at 90% capacity (18,000 units) in May and incurred the following actual overhead. Indirect materials Indirect labor Power Maintenance Actual Overhead Costs: $ 28,800 51,500 13,500 10,000 30,000 20,000 42,000 $ 195,800 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 18,000 units.