Material Price, Usage, mix, yield variance

nebth444

Hi all,

I have a quick question about the material usage variance,

if in the question the standard cost card does not state a common loss for materials but when the actual costs are shown there is a loss of materials, how do I work out the standard loss of material? is it needed

sorry if this question is a bit confusing if you don't understand ill try write it out easier,

Thanks for the help in advance

nebth444

e.g.

if 1 batch of materials makes 500 products

Material A has a quantity of 50 and has a price of £1.50
Material B has a quantity of 25 and has a price of £2
Material C has a quantity of 25 and a price of £1

during July, 50 batches were made but actual output was 24000

Material A has a quantity of 2600 and has a price of £1.60
Material B has a quantity of 1300 and has a price of £1.90
Material C has a quantity of 1200 and a price of £1.10

This question is just for visual explanation

as the output is 24000 means its only made an equivalent of 48 batches

to work out the usage variance do i need to work out the common loss that the standard cost card has? how would i go about working out the usage variance?

Thanks for the help!