The difference between the amount of money actually incurred for variable manufacturing overhead and the amount that should have been incurred for the actual activity level achieved, measured in terms of direct labor hours, is:

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The difference between the actual variable overhead cost and the budgeted variable overhead cost based on the actual activity level is known as variable manufacturing overhead spending variance. The variable manufacturing overhead efficiency variance is the difference between the budgeted variable overhead cost and the actual amount that is incurred based on the actual activity level achieved. The total variable manufacturing overhead variance is the sum of both the efficiency and the spending variances.

The Difference Between the Amount of Money Actually Incurred for Variable