Teatro restoration, inc., begins renovating an old theater for urban edge productions, but after three months teatro demands an extra $250,000. urban edge agrees to pay. refer to fact pattern 13-4. if teatro says it is asking for the extra $250,000 because it has encountered extraordinary unforeseen difficulties that will add considerable cost to the project, the agreement isa. unenforceable as an illusory promise. b. enforceable because of unforeseen difficulties. c. unenforceable due to the preexisting duty rule. d. enforceable as the consideration is past.

Oerstman, inc. uses a standard costing system and develops its overhead rates from the current annual budget.the budget is based on an expected annual output of 120,000 units requiring 480,000 direct labor hours.(practical capacity is 500,000 hours)annual budgeted overhead costs total $772,800, of which $556,800 is fixed overhead.a total of 119,300 units, using 478,000 direct labor hours, were produced during the year.actual variable overhead costs for the year were $260,400 and actual fixed overhead costs were $555,450.required: 1. compute the fixed overhead spending variance and indicate if favorable or unfavorable.2. compute the fixed overhead volume variance and indicate if favorable or unfavorable.