Logistics Solutions provides order fulfillment services for dot.com merchants. The company maintains warehouses that sto

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Logistics Solutions provides order fulfillment services for
dot.com merchants. The company maintains warehouses that stock
items carried by its dot.com clients. When a client receives an
order from a customer, the order is forwarded to Logistics
Solutions, which pulls the item from storage, packs it, and ships
it to the customer. The company uses a predetermined variable
overhead rate based on direct labor-hours.
In the most recent month, 155,000 items were shipped to
customers using 6,000 direct labor-hours. The company incurred a
total of $17,400 in variable overhead costs.
According to the company’s standards, 0.04 direct labor-hours
are required to fulfill an order for one item and the variable
overhead rate is $3.00 per direct labor-hour.
Required:
1. What is the standard labor-hours allowed (SH) to ship 155,000
items to customers?
2. What is the standard variable overhead cost allowed (SH × SR)
to ship 155,000 items to customers?
3. What is the variable overhead spending variance?
4. What is the variable overhead rate variance and the variable
overhead efficiency variance?
(For requirements 3 and 4, indicate the effect of each
variance by selecting "F" for favorable, "U" for unfavorable, and
"None" for no effect (i.e., zero variance). Input all amounts as
positive values. Do not round intermediate
calculations.)