Help - Variance
bspink
Registered Posts: 1
I'm really struggling with Variance, material usage variance and labour efficiency variance. My exams on Tuesday and I'm so stuck! I have been trying the practice paper the 1st one on AAT. I don't get how they get the answers for 2b and 2c, idle time I'm ok with just the others. Thanks!
0
Comments
-
Hi bspink,
I really struggled with variances. Then I watched this video on youtube and it really helped.
https://www.youtube.com/watch?v=H_wAv0QHlYA
For 1.2 b-
I find out what they did use to what they should have used for actual production.
They did use 200,000 litres
They should have used 190,000 liters. You find this out by flexing - 220,000lts/22000 units = 10 litres per unit. 10 x 19000 actual units = 190,000 litres.
This gives 10,000 litres adverse variance but you want to know the variance in £.
You x the 10,000 by the standard cost per litre. (£132,000/220,000lts = £0.60)
10,000 lts x £0.60 = £6000 adverse.
1.2 c -
Find out what they did work - 6900 hrs
Find out what they should have worked - 7200 hrs (6000 std hrs / 10,000 std units x actual units 12,000 units)
= 300 hrs favourable but what you want to know the variance in £ therefore you times this by the standard cost of £15 = £4500 F
Hope this helps!
0
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 (Covid-19)
- 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 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