The total fixed overhead variance is calculated by the following formula:
A)Total actual overhead - Total applied overhead
B)AFOH - Standard overhead rate ´ SH
C)AFOH - SFOR ´ SH
D)AFOH - SFOR ´ AH
E)Total actual overhead - SFOR ´ SH

Question

Quizplus · Accepted Answer

The total fixed overhead variance is calculated by subtracting the total applied fixed overhead from the total actual fixed overhead. Therefore, the formula used to calculate it is AFOH - SFOR * SH, where AFOH is the actual fixed overhead cost, SFOR is the standard fixed overhead rate, and SH is the standard number of hours allowed for production. Option C correctly presents this formula.

The Total Fixed Overhead Variance Is Calculated by the Following