Accounting Dictionary - Letter V

A B C D E F G H I J K L M N O P Q R S T U V W X Y Z
Variable overhead efficiency variance
is the difference between the total standard (estimated) variable overhead cost for the actual volume of allocation base and the flexible budget for variable overhead cost (e.g., standard volume of allocation base times the standard allocation rate). Variable overhead efficiency variance can be determined as the difference between the actual allocation base times the standard overhead rate, on one side, and the standard allocation base times the standard overhead rate, on the other side.
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