HELP!!unit 8 variances and performance indicators

auroraaurora Just JoinedPosts: 3Registered
Please someone help!

I am trying to learn all these formulas for the variances and ratios but not getting anywhere, I just end up using standard instead of actual, or things like that. I'm doing home study and just can't seem to get to learn by heart all formulas.

Has anyone got a trick on how to get around to learn and reminder for good all these formulas please?


Thank you,
Aurora

Comments

  • alwa-37alwa-37 Feels At Home Posts: 38Registered
    hi i'm havin a some problem

    learning varience formulas r v dificult but if u hav a look on these formulas theyr quite similar to each other.. i'm also tryin to find easy way to learn variences:confused1:
  • SandyHoodSandyHood Font Of All Knowledge Posts: 2,034Registered, Moderator
    I prefer to try to understand the results rather than rote learning a process.

    If last month's material cost was £35,000 I want to know whether this was about right for what we produced, and about right for what we used.

    So I look at the overall variance.
    We made 7,000 units, each should use 3kgs of raw material and our standard cost per kg is £1.50.
    We issued 20,000 kgs to production at a cost of £35,000

    So our standard would expect us to use 21,000 kgs to make 7,000 units. These should cost £31,500.
    So we had a total material cost variance of £3,500 (adverse)

    We used 20,000 kgs to make the 7,000 units.
    We would have expected to use 21,000 kgs
    We actually used 20,000 kgs
    So our usage was 1,000 kgs less than the standard
    at £1.50 per kg this gives a material usage variance of £1,500 favourable

    We would expect that the 20,000 kgs we used would cost £1.50 per kg = £30,000
    It actually cost £35,000
    So our material price variance is £5,000 adverse


    I have answered other similar questions:
    Labour
    http://www.aat.org.uk/forums/showthread.php?t=17483
    Overheads
    http://www.aat.org.uk/forums/showthread.php?t=17537
    Sandy
    [email protected]
    www.sandyhood.com
  • fpettiferfpettifer Feels At Home Posts: 40Registered
    get some post-its and loads of different colour felt tips and write the formulas out individually and stick all over your house (or where you mainly study). I've decorated my spare room with them, keep doing loads of questions on them and it'll soon sink in. When doing the questions I find it helps if you write the formula you need at the start all the time (does get a little repetitive but it does work) :lol:
  • auroraaurora Just Joined Posts: 3Registered
    Thanks for your help and suggestions....I have started putting formulas on the doors, and Sandy's example will help.
  • SandyHoodSandyHood Font Of All Knowledge Posts: 2,034Registered, Moderator
    Often at this time I'm asked about variances. I hope this thread will help.
    Sandy
    [email protected]
    www.sandyhood.com
  • A-VicA-Vic Expertise Guaranteed Posts: 6,970Registered
    Another tip i did for DFS is i have a MP3 that does voice recordings so recorded the ratios and lisened every day on the way to work - that way its like learning a song odd but works
  • anniemanniem Experienced Mentor Pewsey, WiltshirePosts: 1,325Registered
    A-Vic wrote: »
    Another tip i did for DFS is i have a MP3 that does voice recordings so recorded the ratios and lisened every day on the way to work - that way its like learning a song odd but works

    What a fab idea, I can use that in hospital - I was thinking of getting an MP3. How do you do voice recordings onto one?
    FMAAT - AAT Licensed Member in Practice - Pewsey, Wiltshire
  • A-VicA-Vic Expertise Guaranteed Posts: 6,970Registered
    anniem wrote: »
    What a fab idea, I can use that in hospital - I was thinking of getting an MP3. How do you do voice recordings onto one?

    its under the recordings tab if you have one then add
  • salfordmansalfordman Feels At Home Posts: 32Registered
    When I was learning the variance formulas and ratios for DFS and PEV, every morning I wrote them all out on two pages.

    When I got to work, I wrote them all out again while the computer loads up in the morning.

    At lunchtime, I wrote them all out again, TWICE.

    Before, I went home, I wrote them all again.

    Before I went to sleep each night, I wrote them out again, TWICE.

    I did the above for 3 weeks before the exam and by the time the exams came I knew them all by heart.

    Also, when doing questions and past papers, its really usefull to write out the formula and to understand what it means. You have a better understanding of what you are working out.

    Just keep at it - It will all sink in
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