The cheque-clearing office of Pay Loans Company is responsible for processing all cheques that come to the company for payment Managers at the company believe that variable overhead costs are essentially proportional to the number of labour-hours worked in the office, so labour-hours are used as the activity base when preparing variable overhead budgets and performance reports. Data for October, the most recent month, appear below Budgeted labour-hours Actual labour-hours Standard labour-hours allowed for the actual number of cheques processed Variable overhead cests office supplies Staff coffee lounge Indirect labour Total variable overhead cost Cost Formula Actual (per labour- Costs Incurced 13 9.40 SV 54.20 13.7 54,877 1,450 1,470 appled at a rate of $7 per direct labour-hour Fixed overhead at Pay Loans Company consists entirely of supervisory salanes and Actual fixed overhead costs totalled $7.200 in October, while the flexible budget was $7000 for the month Required Prepare an overhead performance report for October for the cheque clearing office that includes both spending and efficiency variances for variable overhead and the budget variance for fixed overhead (Indicate the effect of each variance by selecting "F" for favourable, "U" for unfavourable, and "None" for no effect (e, zero variance)) PAY LOANS COMPANY Overhead Performance Report For the Month Ended October 31 D Overhead costs Cont Formula Incred for (per labour 1.345 Labour Hours Actual Coats Flexible Budget Based 1,345 Labour Hers Fleable Budget Besed 1.4/9 Lab Hours Total Velance Breakdown of the Total Variance Spending d Variance Efficiency Variance Varia averhead co Office supplies $ Steffen ge 0.40 1 40 400 Variable overhead costs: office supplies Staff coffee lounge Indirect labour Total variable overhead cost Cost Formule Actuel (per Costs labour Incurred in hour) October $0.40 3 490 0.40 3.40 598 $ 4.20 3,789 $4,877 Fixed overhead at Pay Loans Company consists entirely of supervisory salaries and is applied at a rate of $7 per direct labour-hour Actual fixed overhead costs totalled $7,200 in October, while the flexible budget was $7000 for the month Required Prepare an overhead performance report for October for the cheque clearing office that includes both spending and efficiency variances for variable overhead and the budget variance for fixed overhead. dndicate the effect of each variance by selecting "for favourable, "U" for unfavourable, and "None" for no effect (ie, zero variance)) PAY LOANS COMPANY Overhead Pedomance For the Month Ended 3 Breakdown of the Total Vacance Cost Formula Overhead cost Actual Costs Incurred for (per labour 1.345 Labour hour) Hours Flexide Flexible Budget Based Budget Based on 1.345 on 1,470 Labour-Hours Labour Hours Total Variance Spending (Budget) Variance Efficiency Variance Variable overhead costs Office supplies $ 0.40 $ 490 Staff coffee lounge 0.40 558 Indirect labour 340 3,789 Total variable overhead cost $ 4.20 4877 Flood overhead cos Supervisory salaries Total overhead can 7.200 $ 12.077