The formula to compute the overhead volume variance is:

(a) Fixed overhead rate 3 (Standard hours 2 Actual hours).

(b) Fixed overhead rate 3 (Normal capacity hours 2 Actual hours).

(c) Fixed overhead rate 3 (Normal capacity hours 2 Standard hours allowed).

(d) (Variable overhead rate 1 Fixed overhead rate) 3

(Normal capacity hours 2 Standard hours allowed).

AppendixLO1