If standard unit costs for single product based on 80% operating capacity of 40,000 units.

Direct materials (5# @ $4 per #) $20

Direct labor (2 hrs @ 8.75 per hr) $17.50

Factory overhead: variable (2 hrs @ $3 per hr) $6

Factory overhead: fixed (2 hrs @ $7 per hr) $14

Total standard cost $57.50

Please help with the part I circled. Thanks.

Complete the following flexible budget information: 60% Operating Levels 70% 35,000 30,000 80% 40,000 80,000 Production in units Standard direct labor hours Budgeted overhead Variable factory overhead Fixed factory overhead $240,000 $560,000 During the current year, the company operated at 60% capacity and produced 30,000 units of product. Actual costs incurred during the year were: Direct materials (150,350# @ $4.10 per #) Direct labor (59,800 hrs @ $8.70 per hr) Variable factory overhead costs Fixed factory overhead costs Total actual costs 616,435 520,260 192,000 552,000 $ 1,880,695 Directions: Complete the 4 variance matrices, showing all computations