CARAD CO DECEMBER 2012 PART A ( iii )

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This topic contains 4 replies, has 2 voices, and was last updated by Avatar of johnmoffat John Moffat 2 weeks, 5 days ago.

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  • May 5, 2013 at 3:51 pm #124606
    Avatar of aishaasad
    aishaasad
    Participant

    Hello sir
    I want to clear one point regarding labour efficiency variance in part a ( iii )
    That why the difference of 275 hours is multiplied with $14 and not with $ 18
    although the tempotay labour is being paid higher i.e @$18
    Thanks

    May 5, 2013 at 3:54 pm #124608
    Avatar of aishaasad
    aishaasad
    Participant

    Sorry my mistake its a question from december 2010 not 2012
    Once again I apologize :-(

    May 5, 2013 at 8:07 pm #124656
    Avatar of johnmoffat
    John Moffat
    Keymaster

    The rate variance looks at the difference between the actual rate and the standard rate.

    However the efficiency variance is only looking at the gain or loss due to the hours worked being less or more than budgeted. It is always costed out at the standard rate.

    May 5, 2013 at 8:16 pm #124658
    Avatar of aishaasad
    aishaasad
    Participant

    Thank you so much now I got it that efficiency variance has to be valued
    On standard rate ;-)

    May 6, 2013 at 7:46 am #124681
    Avatar of johnmoffat
    John Moffat
    Keymaster

    You are welcome :-)

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