The Finishing Department of Paragon Manufacturing Co. prepared the following factory overhead cost budget for October of the current year, during which it expected to operate at a 100% capacity of 10,000 machine hours:

During October, the plant was operated for 9,000 machine hours and the factory overhead costs incurred were as follows: indirect factory wages, $16,400; power and light, $10,000; indirect materials, $3,000; supervisory salaries, $12,000; depreciation of plant and equipment, $8,800; insurance and property taxes, $3,200.
Prepare a factory overhead cost variance report for October. (The budgeted amounts for actual amount produced should be based on 9,000 machine hours.)

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Variable cost Indirect factory wages $18,000 Power and light 12,000 Indirect materials 4.000 Total variable cost $34,000 Fixed cost Supervisory salaries $12,000 epreciation of plant and equipment 8,800 Insurance and property axes 3.200 Total fixed cost 24.000 Total factorv overhead $58,000