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[The following information applies to the questions displayed below.] Antuan Company set the following standard costs per unit for its product.

Direct materials (4.0 pounds @ $6.00 per pound)$ 24.00Direct labor (1.9 hours @ $11.00 per hour)20.90Overhead (1.9 hours @ $18.50 per hour)35.15Standard cost per unit$ 80.05

The standard overhead rate ($18.50 per direct labor hour) is based on a predicted activity level of 75% of the factorys capacity of 20,000 units per month. Following are the companys budgeted overhead costs per month at the 75% capacity level.

Overhead Budget (75% Capacity)Variable overhead costsIndirect materials$ 15,000Indirect labor75,000Power15,000Maintenance30,000Total variable overhead costs135,000Fixed overhead costsDepreciationBuilding24,000DepreciationMachinery71,000Taxes and insurance16,000Supervisory salaries281,250Total fixed overhead costs392,250Total overhead costs$ 527,250

The company incurred the following actual costs when it operated at 75% of capacity in October.

Direct materials (61,000 pounds @ $6.20 per pound)$ 378,200Direct labor (22,000 hours @ $11.20 per hour)246,400Overhead costsIndirect materials$ 41,300Indirect labor176,550Power17,250Maintenance34,500DepreciationBuilding24,000DepreciationMachinery95,850Taxes and insurance14,400Supervisory salaries281,250685,100Total costs$ 1,309,700

Required: 1. Prepare flexible overhead budgets for October showing amounts of each variable and fixed cost at the 65%, 75%, and 85% capacity levels.

2. Compute the direct materials variance, including its price and quantity variances. (Indicate the effect of each variance by selecting favorable, unfavorable, or no variance.)

3. Compute the direct labor variance, including its rate and efficiency variances. (Indicate the effect of each variance by selecting favorable, unfavorable, or no variance. Round "Rate per hour" answers to two decimal places.)

4. Prepare a detailed overhead variance report that shows the variances for individual items of overhead. (Indicate the effect of each variance by selecting favorable, unfavorable, or no variance.)