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Variable Overhead Spending and Efficiency Variances Simon Enterprises applies variable overhead at a rate of $1.50 per direct labor hour and fixed overhead at a

Variable Overhead Spending and Efficiency Variances

Simon Enterprises applies variable overhead at a rate of $1.50 per direct labor hour and fixed overhead at a rate of $1.75 per direct labor hour. The company budgets two direct labor hours for each of the 5,900 units that are scheduled for production. Last year, Simon incurred actual variable overhead totaling $18,750, and actual fixed overhead totaling $21,500, for the production of 6,000 units. In addition, 11,800 direct labor hours were actually incurred.

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Enter all amounts as positive numbers

Calculate the variable overhead efficiency variance

$ ? Favorable

Calculate the variable overhead spending variance

$ ? Unfavorable

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