Consider the following results for one month:

Actual Standard overhead applied Total variance

Machine hours 3,000 3,100

Variable overhead $4,200 3,100 @ $1.20 = $3,720 $480 U

Fixed overhead $4,300 3100 @ $1.20 = $3,720 $580 U

Required:

1. Calculate the efficiency and spending variances for variable overhead.
2. Calculate budget and volume variances for fixed overhead costs (normal hours for the month are 3,500)