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Component of Fixed Overheads Variance
Fixed Overhead Expenditure Variance
The fixed overhead expenditure variance is the dissimilarity between the actual fixed expenditure attributed to and charged to the period and the budget cost allowance for production for a particular control period. Therefore it is the difference between the budgeted and actual fixed overheads.
fixed overhead volume variance
The fixed overhead volume variance is the difference among the standard cost absorbed in the production achieved and the budget cost allowed for the period. This arises because of the actual production volume differing from the planned: it is in turn caused with volume differing form the planned: it is in turn reasoned labour capacity variance and or efficiency variance as hours of working being less or more than planned. The fixed overhead efficiency variance, and
The fixed overhead capacity variance
The fixed overhead efficiency variance is the portion of the fixed overhead volume variance that is the difference between the actual labour hours worked and the standard cost absorbed in the production achieved whether completed or not. valued at the standard hourly absorption rate.
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