Variable production overhead total variances

The variable production overhead total variance is the difference between what the output should have cost and what it did cost, in terms of variable production overhead.

	$
1,000 units should have cost (x $8)	8,000
But did cost	9,450
Variable production o/hd expenditure variance	1,450 (A)

The variable production overhead expenditure variance
This is the difference between what the variable production overhead did cost and what it should have cost

	$
4,200 hrs should have cost (x $2)	8,400
But did cost	9,450
Variable production o/hd expenditure variance	1,050 (A)

The variable production overhead efficiency variance
This is the same as the direct labour efficiency variance in hours, valued at the variable production overhead rate per hour.

Labour efficiency variance in hours	200 hrs (A)
Valued @ standard rate per hour	x $2
Variable production o/hd efficiency variance	$400 (A)