For May, Mariana company planned production of 9,600 units (80% of its production capacity of 12,000 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 9,600 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 $ 17,280 28,800 7,200 2,592 55,872 18,000 12,000 23,280 53,280 $ 109,152 It actually operated at 90% capacity (10,800 units) in May and incurred the following actual overhead. Indirect labor Power Maintenance Actual Overhead Costs Indirect materials $ 17,280 31,500 8,100 5,200 18,000 12,000 26,000 $ 118,080 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 10,800 units.