James Corp. applies overhead on the basis of direct labor hours. For the month of May, the company planned production of 9,600 units (80% of its production capacity of 12,000 units) and prepared the following overhead budget: Operating Levels Overhead Budget sex Production in units 9,600 Standard direct labor hours 24,600 Budgeted overhead Variable overhead costs Indirect materials $18,000 Indirect labor 24,000 Power 5,400 Maintenance 3.800 Total variable costs Fixed overhead costs Rent of factory building 20,00 Depreciation-Machinery 10,500 Supervisory salaries 16.100 Total fixed costs 46,00 Total overhead costs $97,200 50,400 During May, the company operated at 90% capacity (10,800 units) and incurred the following actual overhead costs: $ 18,000 26,650 5,875 Overhead costs (actual) Indirect materials Indirect labor Power Maintenance Rent of factory building Depreciation Machinery Supervisory salaries Total actual overhead costs 20,000 10,5 $184,620 1. Compute the overhead controllable variance and classify it as favorable or unfavorable 2. Compute the overhead volume variance and classify it as favorable or unfavorable 3. Prepare an overhead variance report at the actual activity level of 10,800 units. 1. Compute the overhead controllable variance and classify it as favorable or unfavorable. 2. Compute the overhead volume variance and classify it as favorable or unfavorable. 3. Prepare an overhead variance report at the actual activity level of 10,800 units. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Compute the overhead controllable variance and classify it as favorable or unfavorable. (Indicate the effect of each variance by selecting for favorable, unfavorable, and no variance.) Controllable variance Total actual overhead Flexible budget overhead Total Overhead controllable variance Required 2 >