Quality, Inc. uses a standard cost system and provides the following information.One subunit of Xtreme Sports Company had the following financial results last month:

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any zero variances, enter a $0$ in the variance column and then leave the $F$ or $U$ box blank. Enter the variance percent as a percentage rounded to two decimal places, X$.$XX$\%.)$

Requirement $2.$ Based on the data presented, what type of responsibility center is this subunit?

What type of responsibility center is this unit?

Requirement $3.$ Which items should be investigated if part of management's decision criteria is to investigate all variances exceeding $$2,500$ or $10\%?($If a box is not used in the table

Requirement $4.$ Should only unfavorable variances be investigated?

Favorable variances

be investigated to

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direct labor hours, $1,800.$

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Requirement $1.$ Compute the variable overhead cost and efficiency variances and fixed overhead cost and volume variances.

actual cost; $AQ=$ actual quantity; FOH$=$ fixed overhead; $SC=$ standard cost; $SQ=$ standard quantity; VOH$=$ variable overhead. $)$

$AQ=$ actual quantity; FOH$=$ fixed overhead; $SC=$ 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 fixed overhead cost was

than the amount budgeted for total fixed overhead.

The fixed overhead volume variance is

because total fixed overhead cost allocated to units was

than the total budgeted fixed overhead cost.Inc. uses a standard cost system and provides the following information.

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Quality allocates manufacturing overhead to production based on standard direct labor hours. Quality reported the following actual results for $2024$: actual number of units$$ produced, $1$ comma $000$; actual variable$$ overhead, $ $5$ comma $000$; actual fixed$$ overhead, $ $3$ comma $500$; actual direct labor$$ hours, $1$ comma $800.$

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Part $1$

Requirement $1.$ Compute the variable overhead cost and efficiency variances and fixed overhead cost and volume variances.