Manufacturing overhead data for the production of Product H by Shakira Company, assuming the company uses a standard cost system, are as follows. - Overhead incurred for 45,900 actual direct labor hours worked is $417,060. - Overhead rate (variable $8; fixed $1) is $9. - Standard hours allowed for work done are 46,640 hours. Compute the total overhead variance. Total overhead variance Variance Favorable / Unfavorable $

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Variance Analysis

In layman's terms, variance analysis is an analysis of a difference between planned and actual behavior. Variance analysis is mainly used by the companies to maintain a control over a business. After analyzing differences, companies find the reasons for the variance so that the necessary steps should be taken to correct that variance. 

Standard Costing

The standard cost system is the expected cost per unit product manufactured and it helps in estimating the deviations and controlling them as well as fixing the selling price of the product. For example, it helps to plan the cost for the coming year on the various expenses.