Problem 11-58 Flexible Budget, Overhead Variances Shumaker Company manufactures a line of high-top basketball shoes. At the beginning of the year, the following plans for production and costs were revealed: Pairs of shoes to be produced and sold 55,000 Standard cost per unit: Direct materials $15 Direct labor 12 VOH 6 FOH 3 Total unit cost $36 During the year, a total of 50,000 units were produced and sold. The following actual costs were incurred: Direct materials $775,000 VOH $310,000 Direct labor 590,000 FOH 180,000 There were no beginning or ending inventories of raw materials. In producing the 50,000 units, 63,000 hours were worked, 5 percent more hours than the standard allowed for the actual out- put. Overhead costs are applied to production using direct labor hours. Required: 1. Using a ?exible budget, prepare a performance report comparing expected costs for the actual production with actual costs. 2. Determine the following: (a) Fixed overhead spending and volume variances and (b) Variable overhead spending and ef?ciency variances.