ECONOMICS

Detailed explanation-1: -What is Variable Overhead Efficiency Variance? Variable overhead efficiency variance is a measure of the difference between the actual costs to manufacture a product and the costs that the business entity budgeted for it. Thus, it can arise from a difference in productive efficiency.

Detailed explanation-2: -Efficiency variance is the difference between the theoretical amount of inputs required to produce a unit of output and the actual number of inputs used to produce the unit of output.

Detailed explanation-3: -Variable overhead efficiency variance refers to the difference between the true time it takes to manufacture a product and the time budgeted for it, as well as the impact of that difference. It arises from variance in productive efficiency.

Detailed explanation-4: -Which statement regarding variable overhead variance analysis is true? The variable overhead efficiency variance is exactly the same as the direct labor rate variance.

Detailed explanation-5: -Variable Overhead Spending Variance is the difference between what the variable production overheads actually cost and what they should have cost given the level of activity during a period. The standard variable overhead rate is typically expressed in terms of machine hours or labor hours.