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# tips on remembering variances

iainiow
Settling In NicelyRegistered Posts:

**20**
Hi Ya,

im TRYING to revise the plethora of different variance analysis between standard and actual costs.

these include all of the materials, labour and fixed cost variance calculations. I have written them all down countless times, done question after question, but i cant get them to stay in the noggin!!

they all all tantelisingly similar, but are different enough to make it impossible for me to remember.

Any one got any helpful tips on how they managed to remember them??? many thanks

:thumbup1:

im TRYING to revise the plethora of different variance analysis between standard and actual costs.

these include all of the materials, labour and fixed cost variance calculations. I have written them all down countless times, done question after question, but i cant get them to stay in the noggin!!

they all all tantelisingly similar, but are different enough to make it impossible for me to remember.

Any one got any helpful tips on how they managed to remember them??? many thanks

:thumbup1:

0

## Comments

20As the variances are all the something cost of something - the something cost of something else - if you know what I mean, there are 4 things to remember for each variance - I am using acronyms to remember what stays the same on both rows and then I can fill in the blanks:

I am using acronyms - as follows:

Materials variances =

PAUSPrice variances -Actuals stay the sameUse variance -Standard costsLabour variances = RAES

Rate variance - Actuals stay the same

Efficiency variance - standard costs

If you write down the bit from the acronym you can then more easily remember the other bits and fill them in - thats how I am doing it.

Overhead variances are slightly different but I am going for an acronym for each OH variance - an example is

EPAEfficiency variance isplanned hours -actual hoursand volume capacity varaince =

VCABVolumeCapacity variance is OAR X (Actual hours -Budgeted hours)I don't know if this will help you, but having tried various grids and logical thinking as recommended by lots of people, I found that I needed simple acronyms I could write look at just as I was going into the exam and then write down as soon as I get in then I don't have to flap about remembering them.

Everyone is different and I would say keep plugging away and checking out the forums until you find something that works for you.

All the best

Barbara:thumbup1:

9My tutor taught us a way, (dont know if it is his own personal way or a method used by other colleges).

Fixed Material VarianceActual Units xActual CostPrice Variance (Bottom less top calc)

Actual Units xStandard CostUsage Variance (Bottom less top calc)

Standard Units xStandard CostFixed Labour VarianceActual Hours xActual RateRate Variance(Bottom less top calc)

Actual Hours xStandard RateEfficiency Variance (Bottom less top calc)

Standard Hours of Actual Production xStandard RateFixed Overhead VarianceActual (Hours/units) xActual Fixed O/head absorbtion rateExpenditure Variance (Bottom less top calc)

Budgeted (Hours/units) xStandard Fixed O/head absorbtion rateCapacity Variance (Bottom less top calc)

Volume Variance (Capacity minus Efficiency variance)

Actual (Hours/units) xStandard Fixed O/head absorbtion rateEfficiency Variance (Bottom less top calc)

Standard (Hours/units) xStandard Fixed O/head absorbtion rateApparently, the variable overhead never gets examined, but is exactly the same working for the labour variance, with the variances labelled the same.

PS Im sorry if it appears squashed, it dosent really space it out properly. Give it a try and see where the calculations come from

Hope it helps

Paul

9Paul