The total overhead variance is $3810 Favourable.
Overhead variance refers to the distinction between real overhead and applied overhead. You could simplest compute overhead variance after you realize the actual overhead charges for the length. Overhead is implemented based on a predetermined rate and a value-driving force.
Variable overhead spending variance is favorable if the real expenses of oblique substances — for instance, paint and consumables such as oil and grease—are decreased than the standard or budgeted variable overheads. it's far unfavorable if the real charges are better than the budgeted expenses.
Actual Overhead = $127,000
Budgeted Overhead = Standard hours allowed * Predetermined date
= 25,400 x 5.15
= $130,00
Total Overhead variance = Budgeted Overhead - Actual overhead
= 130,810 - 127,000
= $3810 Favourable.
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