Variable Overhead Variances, Service Company Rostand Inc. operates a delivery service for over 70 restaurants. The corporation has a fleet of vehicles and has invested in a sophisticated, computerized communications system to coordinate its deliveries. Rostand has gathered the following actual data on last year's delivery operations: Deliveries made: Direct labor: Actual variable overhead: $159,600 Rostand employs a standard costing system. During the year, a variable overhead rate of $5.50 per hour was used. The labor standard requires 0.80 hour per delivery. Required: 1. Compute the standard hours allowed for actual deliveries made last year. Round your answer to the nearest hour. 38,000 37,000 delivery hours $9.00 30,400 hours 2. Compute the variable overhead spending and efficiency variances. Note: Enter variance amounts as positive values. Then select Favorable or Unfavorable from the dropdown list to designate the type of variance. Spending variance Efficiency variance: Favorable Unfavorable