The following information relates to Morgan, Inc.'s overhead costs for the month: (Click the icon view the information.) Requirements 1. Compute the overhead variances for the month: variable overhead cost variance, variable overhead efficiency variance, fixed overhead cost variance, and fixed overhead volume variance. 2. Explain why the variances are favorable or unfavorable. Requirement 1. Compute the overhead variances for the month: variable overhead cost variance, variable overhead efficiency variance, fixed overhead cost variance, and fixed overhead volume variance. Begin by selecting the formulas needed to compute the variable overhead (VOH) and fixed overhead (FOH) variances, and then compute each variance amount. (Actual cost - Standard cost) * Actual hours = VOH cost variance (Actual hours - Standard hours allowed) * Standard cost VOH efficiency variance Actual overhead - Budgeted overhead FOH cost variance Budgeted overhead - Allocated overhead = FOH volume variance = = = = Data table 7,800 Static budget variable overhead Static budget fixed overhead Static budget direct labor hours 3,900 1,300 hours Static budget number of units 5,200 units Morgan allocates manufacturing overhead to production based on standard direct labor hours. Last month, Morgan reported the following actual results: actual variable overhead, $10,800; actual fixed overhead, $2,770; actual production of 7,000 units at 0.20 direct labor hours per unit. The standard direct labor time is 0.25 direct labor hours per unit (1,300 static direct labor hours / 5,200 static units). Print Done The following information relates to Morgan, Inc.'s overhead costs for the month: (Click the icon view the information.) Requirements 1. Compute the overhead variances for the month: variable overhead cost variance, variable overhead efficiency variance, fixed overhead cost variance, and fixed overhead volume variance. 2. Explain why the variances are favorable or unfavorable. Requirement 1. Compute the overhead variances for the month: variable overhead cost variance, variable overhead efficiency variance, fixed overhead cost variance, and fixed overhead volume variance. Begin by selecting the formulas needed to compute the variable overhead (VOH) and fixed overhead (FOH) variances, and then compute each variance amount. (Actual cost - Standard cost) * Actual hours = VOH cost variance (Actual hours - Standard hours allowed) * Standard cost VOH efficiency variance Actual overhead - Budgeted overhead FOH cost variance Budgeted overhead - Allocated overhead = FOH volume variance = = = = Data table 7,800 Static budget variable overhead Static budget fixed overhead Static budget direct labor hours 3,900 1,300 hours Static budget number of units 5,200 units Morgan allocates manufacturing overhead to production based on standard direct labor hours. Last month, Morgan reported the following actual results: actual variable overhead, $10,800; actual fixed overhead, $2,770; actual production of 7,000 units at 0.20 direct labor hours per unit. The standard direct labor time is 0.25 direct labor hours per unit (1,300 static direct labor hours / 5,200 static units). Print Done