Manuel Company predicts it will operate at $80\%$ of its productive capacity. Its overhead allocation base is DLH and its

standard amount per allocation base is $0\mathrm{.}5DLH$ per unit. The company reports the following for this period.

Exercise $23-17($Algo$)$ Computing standard overhead rate and total overhead variance LO P$4$

Compute the standard overhead rate. Hint: Standard allocation base at $80\%$ capacity is $27,125DLH,$ computed as $54,250$ units $$

$0\mathrm{.}5$ DLH per unit.

Compute the standard overhead applied.

Compute the total overhead variance.

Note: Indicate the effect of the variance by selecting favorable, unfavorable, or no variance.