Pev

spurschic1@yahoo.com

Hiya all,

Is it me or do you find the PEV a nightmare! I'm a distance learner and unfortunately can't get to any revision courses. I've revised and revised and completed past papers but it still isn't going in. Any tips would be sooo greatfully appreciated! Got DFS and PCR to revise yet arrrggghhhhh!

Vicky

lewpylew

Vicky,

Is there anything in particular you need help on and then someone may be able to help x : )

spurschic1@yahoo.com

Hiya,

I'm just getting totally confused with all the formulae for labour and material usage, fixed ohead expen, vol etc

Can't seem to figure them out!

SpursJayJay

Pev

Hi

I've heard that PEV is terrible to distance learn, I go to an evening class one day a week and we haven't even used the level 4 books because the techniques we've learned for variance analysis are not in there. The technique is good, but very hard to learn, but we've got to the point now where we can do the whole of section one of the exam in less than 15 minutes, I'm not sure if the technique I've learn is commonly found on the internet or if its unique to my centre, but if i do come across it on the internet I'll drop you a line ).

Sorry i couldn't have been more help (and its good to see someone else with a good taste in football ......)

JJ

spurschic1@yahoo.com

Thanks JJ, how did you guys learn the formule? The Osbourne book I'm using does it differently than the exams, I think that's why I am so confused!

Great team eh, we're doing brilliantly at the mo, lets hope they keep it up!

Vicky

bec1

Im doing it distant learning from Osbourne books and i feel like giving up,i find the books pretty rubbish

Ampsie

Hi,

I'm so glad i'm not the only one feeling like that! I'm doing Mac but i am studying pev and pcr, long distance with Osborne books.

I got so frustrated with the variances last night that i ripped my notes up and decided to give up!!!!!!!!!!!! One minute i feel like i understand things and then the next minute NOTHING makes sense!

Feeling a bit more positive and determined today. Also my boss has let me have a study afternoon today so i am going to write them all out carefully and try to make it stick.

I've booked onto Sandy Hoods revision day on the 22nd and i just hope that helps me make sense of it all.

Ampsie
(giving it another go!)

DaveIOW

Yeah I have had the same problem with variances, couldnt remember what figures went were. I sat down & wrote them out on cards & transferred it into my own words.

I now ask myself what is the title of the variance asking me?

Material Price Variance - its asking me to compare the price paid to the price I was supposed to pay. So in the variance, the variable will be the price.

Standard price x actual quantity
Actual price x actual quantity

Material Usage Variance - its asking me to compare the quantity used to the quantity I as supposed to use. So in the variance the quantity will be the variable. The extra thing here is that it has to be in monetary terms so it must be standard price

Standard quantity x actual usage x standard price
Actual quantity x actual usage x standard price

it works for all of them, the tricky one is the overhead volume as you also need to consider how the overheads were absorbed units or hours. If its hours then you can go onto efficiency & capacity

spurschic1@yahoo.com

That's great thanks Dave.

I also have a few printouts from my tutor so if anyone would like then send me an email and I'll forward them onto you. Hopefully it'll help us!

Vicky

carlap

I found that working them out this way is much easier

Material Price
Actual Materials x Actual Price
Actual Materials x Standard Price

Adverse if top line is bigger than the bottom Favourable otherwise

Material Usage
Bottom line of Material price is brought down for top line

Actual Materials x Standard Price
Standard Materials for actual sales** x Standard Price -

Adverse if top line is bigger than the bottom Favourable otherwise

**this figure is worked out by dividing the standard materials by standard units then x by actual units


Fixed overheads are worked out similar if you need them I can explain them in that way too

Hope these help

AK002

We got taught a different way which i personally think it much easier.

Lets say for e.g that the standards for X are

Material 1.2m @ £5 per metre = £6 per unit
Labour 1.5 hours @ £3 = £4.50 per unit

The actuals were, 240 units made, £1600 was spent on labour for 370 hours

So you do..

Labour expenditure variance,
Did cost (what it cost to make the units) £1600
Should cost (multiply the units actually made by the standard) - 240 x £4.50 = £1080
Variance (1600 - 1080) = £520.

This variance is Adverse as it did cost more than it should have...

lewpylew

Just a quick reply as supposed to be working! I did my PEV in the summer and what got me through was really simplifying the formula.

I learnt by taking it back to basics and thinking what it should have cost, what I should have used etc by what it did cost etc etc. It really did work and I past 1st time.

Good luck x