# Fixed Overhead Efficiency Variance calculation

Fixed Overhead Efficiency Variance calculation can be calculated When companies adopt four variance approach they divide the overhead efficiency variance (which is calculated when three variance approach is used) into its variable and fixed components. Variable component is called variable overhead efficiency variance and fixed component is called fixed overhead efficiency variance.

Fixed Overhead Efficiency Variance: Learning Objective of the article: Define and explain fixed overhead efficiency variance. How is fixed overhead efficiency variance calculated? What are the reasons / causes of unfavorable fixed overhead efficiency variance? When companies adopt four variance approach they divide the