Question 7 Ana Carillo and Associates is a medium-sized company located near a large metropolitan area in the Midwest. The company manufactures cabinets of mahogany, oak, and other fine woods for use in expensive homes, restaurants, and hotels. Although some of the work is custom, many of the cabinets are a standard size. One such non-custom model is called Luxury Base Frame. Normal production is 1,000 units. Each unit has a direct labor hour standard of 5 hours. Overhead is applied to production based on standard direct labor hours. During the most recent month, only 1,040 units were produced; 4,500 direct labor hours were allowed for standard production, but only 4,000 hours were used. Standard and actual overhead costs were as follows. Actual (1,040 units) $ 14,600 60,700 26,200 14,900 Indirect materials Indirect labor (Fixed) Manufacturing supervisors salaries (Fixed) Manufacturing office employees salaries (Fixed) Engineering costs Computer costs Electricity (Fixed) Manufacturing building depreciation (Fixed) Machinery depreciation (Fixed) Trucks and forklift depreciation Small tools (Fixed) Insurance (Fixed) Property taxes Total Standard (1,000 units) $ 14,300 51,200 26,800 15,500 32,100 11,900 3,000 9,500 3,600 1,800 800 29,800 11,900 3,000 9,500 3,600 1,800 1,700 600 600 400 400 $171,500 $ 178,700 Overhead application rate per direct labor hour LINK TO TEXT LINK TO TEXT Determine how much overhead was applied to production. Applied overhead LINK TO TEXT LINK TO TEXT Calculate the total overhead variance, controllable variance, and volume variance. (Round variable overhead to 2 decimal places and final answers to o decimal places, e.g. 1,575.) Total overhead variance $ Controllable variance $ Volume variance $ LINK TO TEXT LINK TO TEXT Decide which overhead variances should be investigated