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The Best of Italy Pizza Restaurant make pizza for in-house and on-line customers. The company has two direct-cost categories: direct materials and direct manufacturing labor. Variable manufacturing overhead is allocated to products on the basis of standard direct manufacturing labor-hours. Following is some budget data for the Best of Italy Pizza: Direct manufacturing labor use Variable manufacturing overhead 0.42 hours per pizza $4.00 per direct manufacturing labor-hour The Best of Italy Pizza Company provides the following additional data for the year ended December 31, 2019: Planned (budgeted) output Actual production Direct manufacturing labor Actual variable manufacturing overhead 54,000 pizza 43,200 pizza 14,429 hours 586,000 The Best of Italy Company also allocates fixed manufacturing overhead to products on the basis of standard direct manufacturing labor-hours. For 2019, fixed manufacturing overhead was budgeted at $3.00 per direct manufacturing labor-hour Actual fixed manufacturing overhead incurred during the year was $73,000. Required: 1. 2. 3. 4. 5. Prepare a variance analysis of variable manufacturing overhead. Discuss the variances you have calculated and give possible explanations for them. Prepare a variance analysis of fixed manufacturing overhead cost. Is fixed overhead under allocated or over-allocated? By what amount? Comment on your results. Discuss the variances and explain what may be driving them

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