The Bread Company bakes baguettes for distribution to upscale grocery stores. The company has two direct-cost categories: direct materials and direct manufacturing labor. Variable manufacturing overhead is allocated to products on the basis of standard direct manufacturing labor-hours.

Direct manufacturing labor use	0.02 hours per baguette
Variable manufacturing overhead	$10.00 per direct manufacturing labor-hour

Planned (budgeted) output	3,800,000 baguettes
Actual production	2,800,000 baguettes
Direct manufacturing labor	50,400 hours
Actual variable manufacturing overhead	$650,160

The Quick Bread Company also allocates fixed manufacturing overhead to products on the basis of standard direct manufacturing labor-hours. For 2017, fixed manufacturing overhead was budgeted at $3.00 per direct manufacturing labor-hour. Actual fixed manufacturing overhead incurred during the year was $286,000.

1.	Prepare a variance analysis of fixed manufacturing overhead cost.
2.	Is fixed overhead underallocated or overallocated? By what amount?
3.	Comment on your results. Discuss the variances and explain what may be driving them.