To solve this problem, we need to calculate the variable manufacturing overhead variances, specifically the spending variance and the efficiency variance.

Variable Overhead Spending Variance

The spending variance is calculated as follows:

$\text{Spending Variance} = \text{Actual Variable Overhead} - (\text{Actual Hours} \times \text{Standard Rate})$

Where:

• Actual Variable Overhead = $32,000
• Actual Hours = 1,800 hours
• Standard Rate = $45 per hour

$\text{Spending Variance} = 32,000 - (1,800 \times 45)$ $\text{Spending Variance} = 32,000 - 81,000$ $\text{Spending Variance} = -49,000$

Since we are required to enter variances as positive numbers, the spending variance is $49,000.

To determine if the variance is favorable (F) or unfavorable (UF):

• If the actual costs are higher than the standard costs, it is unfavorable (UF).
• In this case, $32,000 is less than $81,000, so the variance is unfavorable (UF).

Variable Overhead Efficiency Variance

The efficiency variance is calculated as follows:

$\text{Efficiency Variance} = (\text{Actual Hours} - \text{Standard Hours Allowed}) \times \text{Standard Rate}$

Where:

• Standard Hours Allowed = Actual Units Produced \times Standard Hours per Unit
• Actual Units Produced = 50 units
• Standard Hours per Unit = 16 hours
• Standard Rate = $45 per hour

First, calculate the Standard Hours Allowed: $\text{Standard Hours Allowed} = 50 \times 16$ $\text{Standard Hours Allowed} = 800$

Now, calculate the efficiency variance: $\text{Efficiency Variance} = (1,800 - 800) \times 45$ $\text{Efficiency Variance} = 1,000 \times 45$ $\text{Efficiency Variance} = 45,000$

Since we are required to enter variances as positive numbers, the efficiency variance is $45,000.

To determine if the variance is favorable (F) or unfavorable (UF):

• If actual hours are more than standard hours allowed, it is unfavorable (UF).
• In this case, 1,800 hours is more than 800 hours, so the variance is unfavorable (UF).

Summary of Variances:

1. The amount of the variable manufacturing overhead spending variance for the period is $49,000.
2. The variable manufacturing overhead spending variance is unfavorable (UF).
3. The amount of the variable manufacturing overhead efficiency variance for the period is $45,000.
4. The variable manufacturing overhead efficiency variance is unfavorable (UF).

Would you like details on any of these calculations or have any questions?

Here are 5 questions you can ask next:

1. How do you calculate fixed overhead variances?
2. Can you explain the difference between standard costing and actual costing?
3. What are some common reasons for unfavorable variances?
4. How do you account for variances in financial statements?
5. What steps can a company take to improve its overhead variances?

Tip: Always double-check your calculations for accuracy, especially when dealing with variances, to ensure you capture any potential errors.