Sunland, Ltd. manufactures shirts, which it sells to customers for embroidering with various slogans and emblems. The standard cost card for the shirts is as follows. Standard Price Standard Quantity Standard Cost Direct materials $3 per yard 2.00 yards $6.00 Direct labor $14 per DLH 0.75 DLH 10.50 Variable overhead $3.20 per DLH 0.75 DLH 2.40 Fixed overhead $3 per DLH 0.75 DLH 2.25 $21.15 Sandy Robison, operations manager, was reviewing the results for November when he became upset by the unfavorable variances he was seeing. In an attempt to understand what had happened, Sandy asked CFO Suzy Summers for more information. She provided the following overhead budgets, along with the actual results for November. The company purchased 81,200 yards of fabric and used 92,800 yards of fabric during the month. Fabric purchases during the month were made at $2.80 per yard. The direct labor payroll ran $449,575, with an actual hourly rate of $12.25 per direct labor hour. The annual budgets were based on the production of 592,000 shirts, using 442,000 direct labor hours. Though the budget for November was based on 44,700 shirts, the company actually produced 41,200 shirts during the month. Variable Overhead Budget Annual Budget Per Shirt November-Actual Indirect material $450,000 $1.20 $48,700 Indirect labor 303,000 0.75 31,500 Equipment repair 199,000 0.30 20,200 Equipment power 55,000 0.15 7,100 Total $1,007,000 $2.40 $107,500