Variable overhead efficiency variance

Variable overhead efficiency variance is the difference between the actual quantity of variable overhead cost-allocation base used and budgeted quantity of variable overhead cost-allocation base that should have been used to produce actual output, multiplied by budgeted variable overhead cost per unit of cost allocation base.

Definitions

According to Cost Accounting by Horngren, Datar, Rajan (14th edition),

Variable overhead efficiency variance. The difference between the actual quantity of variable overhead cost-allocation base used and budgeted quantity of variable overhead cost-allocation base that should have been used to produce actual output, multiplied by budgeted variable overhead cost per unit of cost allocation base.

According to Managerial Accounting by Braun, Tietz (5th edition),

Variable overhead efficiency variance. This variance tells managers how much of the total variable MOH variance is due to using more or fewer hours of the allocation base (u sually machine hours or DL hours) than anticipated for the actual volume of output. It is calculated as follows: SR X (AH - SHA).