The difference between the actual cost driver amount and the standard cost driver amount,multiplied by the standard variable overhead rate,is the:
A)variable overhead rate variance.
B)variable overhead efficiency variance.
C)variable overhead volume variance.
D)over- or underapplied variance.

Question

Quizplus · Accepted Answer

The variable overhead efficiency variance is calculated by taking the difference between the actual cost driver amount and the standard cost driver amount, and then multiplying that difference by the standard variable overhead rate. This variance measures the efficiency of using the variable overhead resources.

The Difference Between the Actual Cost Driver Amount and the Standard