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Hi
So I understand that material usage is broken down to material mix and material yield
but I am having trouble seeing where the calculations between material mix and usage differ?
Mix is the (AQ*ACTUAL MIX – AQ*STAND MIX)* STANDARD PRICE. Isnt usage the same formula?
AQ AM @ STD
MIX IT’S THE DIFF BETWEEN THE ACTUAL MIX & STD MIX OF INPUT
AQ SM @ STD
YIELD IT’S THE DIFF BETWEEN THE ACTUAL QTY & STD QTY OF “OUTPUT”
SQ SM @ STDUSAGE IS MIX AND QTY ADDED TOGETHER
What is a usage variance?
The difference between:AQ SP
THE DIFFERENCE BETWEEN FLEXED (WHAT SHOULD WE HAVE USED AS A STD QTY)
AND ACTUAL MATERIALS USED(AU) SQ SP
I also have another question:
To calculate material yield which of the following is used:
1- Actual quantity of materials at STD PRICE
2- Actual quantity of materials at standard price
3- Actual yield at standard materials cost.
4- Standard yield from actual input of materials at standard cost.What is the difference between the terms Actual Quantity and Actual Yield?
Thank you
The material yield variance is calculated as the difference between the standard cost of the actual input materials in the standard mix, compared to the standard cost of the standard quantity of input materials in the standard mix.
or another way of saying it
The yield variance is calculated as the difference between the standard input for what was actual output, and the actual total quantity input (in the standard mix), valued at standard costs.
The yield variance identifies if the inputs (in total) are greater or less than expected for a given output. It is related to output overall!
Yield Variance
Actual Output X
Standard Output
(from actual input) XDifference X
Standard Cost per X
Unit(kgs)Yield Variance X
Thank you- its clearer now! I just get bogged down when I make calculation mistakes! Just typed out a whole question on what I was doing wrong- just to solve it correctly while I was typing 🙂
Thank you!
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