Im looking to understand Variances & Performance Indicators!!

Ashley Registered Posts: 1 New contributor 🐸
Im wondering if anyone can help me?? I am 7 months through technician level and I am a very confussed little person!! I cant get to grips with overhead variances and all the written info to do with performance indicators? Was wondering if anybody out there can offer me a bit of advice on how to get my head around understanding what it is I am actually doing???


  • sebastianforbes
    sebastianforbes Registered Posts: 172 πŸŽ† 🐘 πŸŽ†
    i'm having exactly the same problem.

    repetition of questions... and repetition of questions !!!
  • tattookitten
    tattookitten Registered Posts: 46 πŸ’« 🐯 πŸ’«
    OMG me too!
    My tutor went over it really quickly and I was like whoa wait what?! So I've started making myself flash cards for the whole A x A, A x S etc layout and done one for material, labour and fixed o/h, I'm thinking that practising it will help.
  • SandyHood
    SandyHood Registered, Moderator Posts: 2,034
    Here is a reply I sent on the old forum
    If production is lower than budget

    There will always be an adverse f o volume variance

    There are more than one way to work out the value, one way is overhead absorbed per unit x difference between budgeted output and actual output.

    If hours worked are lower than budgeted total hours

    There will always be an adverse f o capacity variance

    one way to work out the value is overhead absorbed per hour x difference between budgeted hours and actual hours.

    If the standard hours (units produced x standard hours per unit) are lower than the actual hours

    There will always be a favourable f o efficiency variance

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