Earlier papers in this series have shown how the extended coupled-cluster method (ECCM) provides a widely applicable biorthogonal formulation of quantum many-body and quantum field theory. Rules for calculating matrix elements of arbitrary operators have been formulated, and an exact description of the excited states has been given in terms of a generalized random-phase approximation for the many-body, quasilocal c-number (classical), ECCM cluster amplitudes which completely and exactly parametrize the system. The present paper introduces a variational functional in order to treat the excited states differently within the ECCM framework, so as to allow extra flexibility in the choice of approximation schemes. The method is tested on the SU(2) quasispin model of Lipkin, Meshkov, and Glick [Nucl. Phys. 62, 188 (1965); 62, 199 (1965)], which contains the spontaneous breakdown of parity, and which models a shape transition in finite atomic nuclei. The method very well describes both the ground and excited states of the model Hamiltonian over a broad range of coupling parameters on both sides of the critical value corresponding to the transition.