FNPF struggle......
Chimpette22
Registered Posts: 75 Epic contributor 🐘
This is the 1st time I've really struggled with learning formulas...
I just can't get my head around it.
To those that have been there and done this, or like me still studying it... Is there an easy way to remember them....?? :crying:
I just can't get my head around it.
To those that have been there and done this, or like me still studying it... Is there an easy way to remember them....?? :crying:
Fully AAT qualified July 2015
0
Comments

Sadly there is no easy way!! I too really struggled with this unit, sure everyone has different way of remembering but this worked for me (passed with 5 exceeded, 1 metwritten, 1 borderlinewritten & 1 didnt):
Efficiency = Standard  Actual
Capacity = Actual  Budgeted
Volume = Standard  Budgeted
If for overheads then just x OAR
Efficiency = Standard  Actual
Capacity = Standard  Actual
Usuage = Standard  Actual
Cost or Rate (Actual x Std)  Actual
Planning v Control Variances
Total = Standard  Actual
Planning = Standard  Adjusted
Control = Adjusted  Actual
Had to keep repeating 'should have' versus 'did', or 'available' versus 'used'
I missed answering the price index question, so would definitely get that in mind (section got 1 did not meet).
I am sure that others on the forum will give you suggestions too  I know they did for me!!0 
Hey I really struggled with this exam I have just re sat it for the 3rd time =( Its the written sections that get me.
With the formulas if you just keep doing them over and over again you will remember them I have done them that many time now i know them off by heart the one i struggled with was capacity and efficiency variance and the way I remembered it was 
BAF CAP
Budgeted hours x Standard rate per hour of fixed overhead
2000 x 2 hours = 4000hrs x 1.50 = 6000
Actual hours x Standard Rate per hour of fixed overhead
3450 x 1.50 = 5175
Flexed hours x Standard Rate per hour of fixed overhead]
1800 x 2 = 3600 x 1.50 =5400
Capacity = Budgeted  Actual
6000  5175 = 825
Efficiency = Actual  Flexed
5175  5400 = 2250 
I also struggled remembering the formulas but once you have a technique that works it's not difficult. I'm not
sure which formulas you struggle on  so I will try to explain them all
Key
Material Variances
SP = Standard Price
AP = Actual Price
SQ = Standard Quantity
AQ= Actual Quantity
Labour
AH = Actual Hours
SH = Standard Hours
SR = Standard Rate
AR = Actual Rate
Fixed Overhead Variances
OAR = Overhead Absorption Rate
AOUT= Actual Output
BOUT = Budgeted Output
BFO = Budgeted Fixed Overheads
AFO = Actual Fixed Overheads
AHT= Actual hours taken
SHT = Standard hours taken
SHAO = Standard hours for actual output
So this is my key chain for remembering the formulas
The formulas with my key chain are as follows:
Direct Material Price Variance = AQ(SPAP)
Direct Material Usage Variance = SP(SQAQ)
Direct Labour Rate Variance = AH(SRAR)
Direct Labour Efficiency Variance = SR (SHAH)
Fixed Overhead Expenditure Variance = BFO  AFO
Fixed Overhead Volume Variance = OAR(AOUTBOUT)
Fixed Overhead Efficiency Variance = OAR(SHAOAHT)
Fixed Overhead Capacity Variance = OAR(AHTSHT)
So now using these formulas, I'm going to do a couple of questions from an aat cbt examAAT
Level 2  2010
Level 3  2011
Level 4  2013
ACCA
F4  2015
F5  20150 
AAT cbt exam 1
Task 1.2 a)
Total Material Price Variance = AQ(SPAP)
AQ= 10000
SP = 3
AP= 33000/10000=3.3
Type into the formula = 10000(33.3) = 3000 ad
Now next question 1.2 b)
Material Usage Variance= SP(SQAQ)
SP= 14000/4000=3.5
SQ= 4000
AQ= 5000
Type into the formula = 3.5(40005000)= 3500 ad
As I'm going through the cbt might as well do task 1.2d) as well lol
That's just 6000/12000*14*14000= 98000
Now task 1.3
The Fixed Overhead Volume Variance = OAR(AOUTBOUT)
OAR= Budgeted Overheads/ Budgeted Output = 24
AOUT = 30000
BOUT= 25000
So now we type into the formula= 24(3000025000) = 120000 Fav
Fixed Overhead Expenditure Variance= BFOAFO a nice easy one
BFO= 600000
AFO = 650000
Just 600000650000=50000 ad
Fixed Overhead Efficiency Variance = OAR(SHATAHT) a tricky one
To work out the OAR for efficiency= Budgeted Overheads/ Budgeted Labour hours
So OAR = 50000/50000=1
SHAT= 50000 which is budgeted hours/ budgeted output which is 5000 then *4000= 50000/5000*4000=40000
AHT= Is just 43000
So now whack into the formula 1(4000043000)=3000 ad
Fixed Overhead Capacity Variance = OAR(AHTSHT)
For the OAR for Capacity  you use the same figure as the OAR for efficiency
OAR= 1 from before
AHT= 43000
SHT = 50000
Now put into the formula = 1(4300050000)= 7000 ad
I also really struggled with the formulas but once I remembered the keys  it really help me out a lot:)
Hope this helps to remember the formulas
If you're still unsure don't hesitate to askAAT
Level 2  2010
Level 3  2011
Level 4  2013
ACCA
F4  2015
F5  20150 
Thanks Aaron! Thats exactly how I am learning them!! Got post it notes all around my pc screen, just to jog my memory!!Level 2  Passed 2011
Level 3  Passed 2012
Level 4  Passed 2014
Awaiting to start CIMA0 
lol i know the formulas off by heart now!!!
Keep practising them and it will pay off eventually :thumbup1:AAT
Level 2  2010
Level 3  2011
Level 4  2013
ACCA
F4  2015
F5  20150 
Thank you everyone for your answers, Aaron I'm printed yours out and I'm reading it over and over again.... Thanks I really appreicate this :thumbup1:Fully AAT qualified July 20150

No worries Chimpette :thumbup1:
If you're still unsure on the formulas, let us know and we can go through some more cbt questions.AAT
Level 2  2010
Level 3  2011
Level 4  2013
ACCA
F4  2015
F5  20150
Categories
 All Categories
 1.2K Books to buy and sell
 2.3K General discussion
 12.5K For AAT students
 319 NEW! Qualifications 2022
 157 General Qualifications 2022 discussion
 11 AAT Level 2 Certificate in Accounting
 56 AAT Level 3 Diploma in Accounting
 92 AAT Level 4 Diploma in Professional Accounting
 8.8K For accounting professionals
 23 coronavirus (Covid19)
 272 VAT
 92 Software
 274 Tax
 136 Bookkeeping
 7.2K General accounting discussion
 201 AAT member discussion
 3.8K For everyone
 38 AAT news and announcements
 345 Feedback for AAT
 2.8K Chat and offtopic 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