MAC Effiency Variances
A-Vic
Registered Posts: 6,970 Beyond epic contributor ๐งโโ๏ธ
Slowly learning variances but am always getting stumped with these any tips or advice on these would be really helpful.
Vic
Vic
0
Comments
-
if they are the same as the pec and pvr ones, i wrote them all down on an a4 piece of paper and stuck it near my monitor.
once i had grasped what they were for, it clicked. you have to understand why you are using them and what the answer tells you, if that makes sense.
tracy0 -
Thanks Tracy
Yeah Mac the same i think.0 -
0
-
Thats fab thanks tracy copy pasted and printed on the wall at work0
-
no worries
http://forums.aat.org.uk/showthread.php?t=19695&highlight=pev+variances
also another good post0 -
I don't know if this will help you but the way we were taught to remember it is as follows:
Remember Saab:
S - standard hours
A - actual hours
A - actual hours
B - budgeted hours
Volume: S-B x OAR
Efficiency: S-A x OAR
Capacity: B-A x OAR
i found it easier as there wasn't all the words involved in remembering the formulas!0 -
I don't know if this will help you but the way we were taught to remember it is as follows:
Remember Saab:
S - standard hours
A - actual hours
A - actual hours
B - budgeted hours
Volume: S-B x OAR
Efficiency: S-A x OAR
Capacity: B-A x OAR
i found it easier as there wasn't all the words involved in remembering the formulas!
Thats brill deffo will help thank you0 -
I remembered variances using this diagram:
<
V
>
SHAO - AH - BH x OAR
<--E--><--C-->
(I just remembered the word SHAOAHBH)
SHAO = standard hours for actual output
AH = Actual hours
BH = Budgeted hours
OAR = O/Head absorption rate
E = Efficiency variance
C = Capacity variance
V = Volume variance
from the diagram:
Volume variance = (SHAO - BH) x OAR
Efficiency variance = (SHAO - AH) x OAR
Capacity variance = (AH - BH) x OAR
Only variance not listed is Overhead expenditure variance which is a simple formula:
Overhead Expenditure variance = Budgeted overheads - Actual Overheads
Theres also PAUS (Price based on Actual, Usage on Standard):
So:
Material price variance = (SP - AP) x AQ
Material Usage variance = (SQ - AQ) x SP
where SP = Standard price, AP = Actual price, SQ = Standard Quantity, AQ = Actual quantity.
Hope this helps0 -
MAC is hopefully my last exam to sit, I haven't really started yet, I'm getting a headache just reading this thread!0
-
the books pretty good jill0
-
lord just reading i understand what jill means tho there seems a lot to remember0
Categories
- All Categories
- 1.2K Books to buy and sell
- 2.3K General discussion
- 12.5K For AAT students
- 325 NEW! Qualifications 2022
- 160 General Qualifications 2022 discussion
- 11 AAT Level 2 Certificate in Accounting
- 56 AAT Level 3 Diploma in Accounting
- 95 AAT Level 4 Diploma in Professional Accounting
- 8.9K For accounting professionals
- 23 coronavirus (Covid-19)
- 273 VAT
- 92 Software
- 274 Tax
- 138 Bookkeeping
- 7.2K General accounting discussion
- 202 AAT member discussion
- 3.8K For everyone
- 38 AAT news and announcements
- 345 Feedback for AAT
- 2.8K Chat and off-topic discussion
- 582 Job postings
- 16 Who can benefit from AAT?
- 36 Where can AAT take me?
- 42 Getting started with AAT
- 26 Finding an AAT training provider
- 48 Distance learning and other ways to study AAT
- 25 Apprenticeships
- 66 AAT membership