Question

Is it possible to have a variable-overhead efficency variance of zero?

Would that be correct in saying it is not favoruable (F) nor unfavourable (U)

and what does that mean?

Answer 1

We Know that,

Variable Overhead efficiency Variance = Standard variable overhead rate *(Actual hours - Standard hours)

Yes,

Variable-overhead efficency variance can be Zero.

It means that there is no difference between the Actual hours worked & the standard hours set for the work.That means Everything went as budgeted.

We should not say it is not favourable variance nor a unfavourable variance, we should say that there is no Variance between the hours allotted & hours Worked.