Problem 10A-8 (Algo) Applying Overhead; Overhead Variances (LO10-3, LO10-4) Lane Company manufactures a single product that requires a great deal of hand labor. Overhead cost is applied on the basis of standard direct labor-hours. The budgeted variable manufacturing overhead is $2.60 per direct labor-hour and the budgeted fixed manufacturing overhead is $495,000 per year. The standard quantity of materials is 4 pounds per unit and the standard cost is $4.50 per pound. The standard direct labor-hours per unit is 1.5 hours and the standard labor rate is $12.30 per hour. The company planned to operate at a denominator activity level of 75,000 direct labor-hours and to produce 50,000 units of product during the most recent year. Actual activity and costs for the year were as follows: Actual number of units produced 60,000 Actual direct labor-hours worked 97,500 Actual variable manufacturing overhead cost incurred $ 165,750 Actual fixed manufacturing overhead cost incurred $ 536,250 Required: 1. Compute the predetermined overhead rate for the year. Break the rate down into variable and fixed elements. 2. Prepare a standard cost card for the company's product. 3a. Compute the standard direct labor-hours allowed for the year's production. 3b. Complete the following Manufacturing Overhead T-account for the year. 4. Determine the reason for any underapplied or overapplied overhead for the year by computing the variable overhead rate and efficiency variances and the fixed overhead budget and volume variances. Req 1 Req 2 Req Req 3B Req 4 Compute the predetermined overhead rate for the year. Break the rate down into variable and fixed elements. (Round your answers to 2 decimal places.) Predetermined overhead rate Variable rate per DLH per DLH per DLH Fixed rate Req 1 Req 2 Req Req 3B Req 4 Prepare a standard cost card for the company's product. (Round your answers to 2 decimal places.) per pound Direct materials Direct labor Variable overhead Fixed overhead Standard cost per unit pounds at DLHs at DLHs at per DLH per DLH per DLH DLHs at Req 1 Req 2 Req Req 3B Req 4 Compute the standard direct labor-hours allowed for the year's production. Standard direct labor hours Req 1 Req 2 Req Req 3B Req 4 Complete the following Manufacturing Overhead T-account for the year. Manufacturing Overhead Req 1 Req 2 Req Reg 3B Req 4 Determine the reason for any underapplied or overapplied overhead for the year by computing the variable overhead rate and efficiency variances and the fixed overhead budget and volume variances. (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Input all amounts as positive values.) Show less Variable overhead rate variance Variable overhead efficiency variance Fixed overhead budget variance Fixed overhead volume variance