K Best, Inc. uses a standard cost system and provides the following information. (Click the icon to view the information.) Best allocates manufacturing overhead to production based on standard direct labor hours. Best reported the following actual results for 2024: actual number of units produced, 1,000; actual variable overhead, $3,800; actual fixed overhead, $3,500, actual direct labor hours, 1,400. Read the requirements Begin with the variable overhead cost and efficiency variances. Select the required formulas, compute the variable overhead cost and efficiency variances, and identify whether each variance is favorable (F) or unfavorable (U). (Abbreviations used: AC = actual cost, AQ = actual quantity, FOH = fixed overhead; SC = standard cost, SQ = standard quantity; VOH = variable overhead.) VOH cost variance Formula (AC - SC) AQ Variance VOH efficiency variance (AQ - SQ) AC U F Data table Now compute the fixed overhead cost and volume variances. Select the required formulas, compute the fixed overhead cost and vo unfavorable (U). (Abbreviations used: AC = actual cost; AQ = actual quantity; FOH = fixed overhead; SC = standard cost; SQ = star Static budget variable overhead $2,300 Formula FOH cost variance FOH volume variance Actual FOH - Budgeted FOH Bugeted FOH - Allocated FOH Variance 350 U Static budget fixed overhead Static budget direct labor hours Static budget number of units Standard direct labor hours $3,450 1,150 hours 575 units 2 hours per unit Requirement 2. Explain why the variances are favorable or unfavorable. The variable overhead cost variance is unfavorable because the actual cost per direct labor hour was more than the standard d The variable overhead efficiency variance is favorable because management used fewer direct labor hours than standard an The fixed overhead cost variance is unfavorable because the total fixed overhead cost was more than the amount budgeted fo Print Done The fixed overhead volume variance is favorable because total fixed overhead cost allocated to units was more than the total budgeted fixed overhead cost. - X