Premium inc. uses a standard cost system and provides the following information.

Premium allocates manufacturing overhead to production based on standard direct labor hours. Premium reported the following actual results for 2024: actual number of units produced, $1000 actual variable overhead, $3800; actual fixed overhead, $3400; actual direct labor hours, $1,800.

Requirement 1. Compute the variable overhead cost and efficiency variances and fixed overhead cost and volume variances. Bogin with the variable ovorhoad cost and officioncy variances. Seloct the required formulas, compute the variable overhead of actual quantity: FOH = fixod overhoad; SC = standard cost; SQ = standard quantity; VOH = variablo overhoad.) Now compute the fixod overhead cost and volume variances. Seloct the requirod formulas, compute the fixed overhoad cost i quantity, FOH= foxod overhoed; SC= standard cost; SQ= standard quantity.) Requirement 2. Explain why the variances are favorable or unfavorable. The variable overhead cost variance is because the actual cost per direct labor hour was than the standard cost per direct labor hour. The variable overhead efficiency variance is because management used direct labor hours than standard and variable overhead is applied (incurred) based on direct labor. The fixed overhead cost variance is because the total foxed overhead cost was than the amount budgeted for total foxed overhcad. Tho fxed overhead volume varianco is becauso total fixod overhoed cost allocatod to units was than the total budgetod fixod overhoad cost. Choose from any list or enter any number in the input fields and then continue to the next question. Data table Static budget variable overhead $1,500 Static budget fixed overhead $2,250 Static budget direct labor hours 750 hours Static budget number of units 375 units Standard direct labor hours 2 hours per unit Print Done