paxter company manufactures 3 single product and uses a standard cof: system to help in the control of costs. Overhead is applied to production on a the following over- basis'of machine-hours. According to the company's costs should be incurred at an activity level of 35,000 madhige-bours (the denomina ectivity level chosen for 201 Variable overhead costs....$ 87.500 Fixed overhead costs..210,000 Total overhead costs$297,500 During 2017, the following operating results were recorded Activiry: Actual machine-hours worked. Standard machine-bours allowed for output32,000 30,000 Cost Actual variable overhead cost incurred. . Actual fixed overhead 78,000 . . . . . . . 209.40 cost incurred A: the end of the year, the company's Manufacturing Overhead account contained the Mansfecturing Overhead 287,400 Applied following data: Actual 15,400 Management would like to determine the cause of the S15,400 underapplied overbead before closing the amount to cost of goods sold. 1. Compute the predetermined overbead rate that would have been used during 2017. Reqaired 2. Show how the $272,000 "Applied" figure in the Manufacturing Overhead account was 3. Analyze the $15,400 underapplied overhead figure in terms of the variable overhead Break the rate down into variable and fixed cost elements. computed. spending and efficiency variances and the fixed overhead budget and volume vari- ances. 4. Explain the meaning of each variance that you computed in (3) above, and indicate how each variance is controlled