Production volume variance is Unfavorable and Fixed overhead spending (budget) variance is favorable.
<u>Explanation:</u>
The formula for fixed budget variance as follows
The Fixed overhead budget Variance = Budgeted Fixed Overhead minus Actual Fixed overhead
= $4000 minus $3800 = $200 Favorable
Fixed overhead spending (budget) variance is favorable.
The formula for Production Volume Variance is as follows:
The Production Volume Variance = Applied Fixed Overhead minus Budgeted Fixed Overhead
= ($4 into 900) minus $4000 = $3600 minus 4000 = $400 Unfavorable
Therefore, Production volume variance is Unfavorable.
