Read the semester case study and answer the questions below: It is now July 2021 and the new production facility for hybrid mattresses became operational on 1 June 2021. Una Volk, Finance Manager, telephones you and says: "Ben De Luca, Chief Executive Officer, has asked for an explanation of the fixed production overhead variances for the new production facility for June 2021. He has also queried the usefulness of these variances for controlling fixed production overhead. This is the first month that the new facility has been operational. There were some unforeseen costs associated with insuring and safety testing the building that occurred in June and there was a delay in employee training. It had been expected that the direct workforce would be made up of 10 new inexperienced employees and 15 experienced employees transferred from the main production facility. In reality there were 20 new and 8 transferred employees. An additional supervisor was also appointed. Ben has sent me two queries regarding some of the non-current assets in the new production facility.

Required: Using the information , prepare briefing note for Ben which includes: -An explanation of what each of the fixed production overheads variances mean and reasons why each variance has occurred. Please also explain any limitations of using these variances to control the fixed production overheads at the new facility.

-In your briefing note to Mr Ben you just need to explain what the variances mean. You do not need to perform the calculation of each variance as the variances have been provided in the attached schedule. For example for expenditure variance, you could tell Ben as the variance is E$10,813 adverse, it means that the actual expenditure is more than budgeted amount. Thereafter provide the possible reasons for the variance.

** Please provide answer with explaination in details (Up to 500 words explanation) **