like this orrect : Requirement 2. Explain why the variances are favorable or unfavorable. The variable overhead cost variance is favorable because management spent less than budgeted for the actual production. Part 4 The variable overhead efficiency variance is favorable because management used fewer direct labor hours than standard and variable overhead is applied (incurred) based on direct labor. Part 5 The fixed overhead cost variance is unfavorable because management spent more than the amount budgeted for fixed overhead. Part 6 The fixed overhead volume variance is favorable because management allocated more fixed overhead to jobs than was budgeted