pev formula???

renae

Hi guys,

Ive read in prev threads the formula AQ x (SP-AP) for the price variances, what is the formula for the usage??
If I had half a brain cell left I could prob work it out........but not any more :blushing:

gingervicki

SP x SU - AU


i think:confused1:

v

renae

No :-(
Looking at dec 08 paper, b, direct material (glass) usage variance.
the answer is nil (worth it) but using that formula I get 6,000! eek
Not sure if there even is one, or is it SU / bu x au?

lessci

I don't use formulas to remeber these but:
Should have Used (at Standard Price) - Actually Used (at Standard Price),
if thats any help

renae

:001_smile: big help ta

Londina

as I said in another post...
My book didn't teach any formula...was always shows this way instead:

MATERIAL PRICE VARIANCE
standard: £5 x 200kg= £1000
actual: £6 x 200kg = £1200
variance: £200 adverse

since I started to use the formulas from the past paper and various comments here, I got confused, because using (SP-AP) x AQ I don't see quite clearly what's I'm calculating and most of the time I was taking the wrong amount!!
So I now prefer to get back to my own original way, even it's a bit longer, at least it's clear what I'm doing

dobbieobby

I'm weird, for price variance I remember PAM.
Because the Price variance is Actual Materials (or litres, whatever) x the standand cost - what it did actually cost.