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August 28, 2022 at 8:27 am
Is there a reason as to why we didn’t calculate the material price variance please?
March 7, 2022 at 9:26 pm
Hi John, When doing the yield variance, in the first column, the section for actual total input at std mix why did we use quantities of what the mix should have and not the units of what the mix actually was (10133 vs 9900 and 5067 vs 5300)?
John Moffat says
March 8, 2022 at 8:23 am
Because we are looking at the effect of changing the mix separately when calculating the mix variance.
January 19, 2022 at 1:18 pm
Hi John, hope you’re well. Can there be a scenario in which the question asks more than 2 materials, let’s say 3 and in that case what do we do?
January 19, 2022 at 3:36 pm
Yes there can, and the ‘rules’ are exactly the same.
May 9, 2021 at 4:48 pm
Dear John, While calculating the yield variance, why we had to take the ratio of material used in mix variance. Why could we not just take the actual usage of material X and Y as defined in question?.
May 10, 2021 at 6:58 am
No. We are trying to check separately the effect go changes in the mix and changes in the yield.
February 8, 2021 at 11:19 am
Thank you sir, great class. i have a doubt. Usage variance is the sum of Mix and Yield variane. If in the question its just asks us to find Usage variance, How can we find it directly without finding Mix and yield…?
February 8, 2021 at 12:48 pm
By comparing the actual quantities with the standard quantities for the actual level of production, both costed at the standard cost.
However it would be unusual for a question to ask for the usage variance without asking for the analysis into the mix and the yield variances.
July 24, 2021 at 2:58 pm
I have done that and in question the actual usage is 15,200kgs whereas the standard usage for actual production is 15,000 kgs, and the difference of them at standard cost is coming out to be $1,600(A), but in the answer sheet it’s coming out to be $300(A). Can you please tell me what’s wrong with this?
Thanks in advance, Jatin
July 24, 2021 at 4:07 pm
The actual purchases are 15,200 kg and at standard cost are $40,300.
The original budget was for 10,000 kg of X and 5,000 kg of Y, which at standard cost is $40,000.
September 1, 2020 at 5:00 am
I hope you are great Sir, thank you for your time and your informative lecture I understand your lecture lesson very well but in regards to yield variance according to my understanding its the difference between the actual output and the budgeted output so the total difference is 15200-15000=200 (A) then we can allocate this variance to X and Y it will give us the yield variance in KG then we can times those by the standard cost per kg. It will give you the same result. Is that right Sir,
September 1, 2020 at 7:59 am
Yes, that is right. It does not matter which way you do it.
August 20, 2020 at 12:36 pm
Sir, the lecture videos are not playing. What could be the problem?
August 20, 2020 at 3:10 pm
The videos are working fine.
If you are still having a problem with your computer then please ask in the Technical Problems Forum
August 11, 2020 at 10:19 pm
Hi John, please can you explain why did we use std cost to cost the mix variance ?
August 12, 2020 at 9:23 am
Because we are looking only at the effect of changes in the mix. The effect of changes in the price is calculated in the price variance.
May 3, 2020 at 2:31 am
Thank you Sir for your easy to understand lectures! I would be glad if you answer my following question. Let’s assume that our final product is Fruit Juice which is measured in litters and we use 3 type of material to produce final product. And the materials we use are measured in different unit of measure. Sugar and fruit (cherry) are in kg, but flavor enhancer is in liter. And of course adding them in different proportion rather than in standard mix will still give us final product of Juice so there is certainly mix effect there. My question is can we still use the same approach in mix calculation in this case? Thank you for your answer in advance!
May 3, 2020 at 10:28 am
Yes, it would be the same approach (but is not the case in the exam 🙂 )
July 30, 2019 at 6:08 am
Thanks John for breaking down your lectures to everyone’s understanding. Please I’lld like to ask how we got the 2/3 and the 1/3 that was used to multiply the total material usage of 15200 in the mix variance. Thanks in advance for your response.
July 30, 2019 at 8:52 am
On the standard cost card printed in the lecture notes, the total input for 1 unit is 3kg of which 2 kg (i.e. 2/3) are Material X and 1 kg (i.e. 1/3) are Material Y
July 31, 2019 at 3:32 am
Wow! I now understand it. Thanks again John, u are the best:)
July 31, 2019 at 6:22 am
You are welcome 🙂
July 12, 2019 at 11:18 am
Sir, you say that when analysing the toal yield variance between the different materials, they will always both be favourable or adverse. However, in the example, the yield variance is not in the same proportions as the standard mix. Therefore, theoretically, this could provide a result where although the total yield variance is either A/F, the indivudual variances could be both A and F? How can we ignore the effect of the yield variance on the mix variance?
July 12, 2019 at 11:22 am
No – the yield variances must all be favourable or must all be adverse. Given that we are using standard mix for both the actual total usage and the standard total usage it cannot possibly be otherwise. There is nothing theoretical about it! 🙂
May 14, 2019 at 6:22 pm
I love your lectures, thank you so much for making it seem so easy. and for the last part too
December 24, 2018 at 8:24 pm
Just simple enough to be easy understand, Thanks John. I just got confused in one point in the yield variance section; why we did use 10,133kg X & 5,067kg Y rather than 9,900kg X & 5,300kg Y at the actual total input as these are actually our inputs. I will leave it here and also will drop it in ask tutor forum. Appreciate your advice John.
December 25, 2018 at 9:48 am
We use the actual total input at standard mix, so that all we are measuring is the yield variance (the mix variance was dealt with separately).
November 8, 2018 at 7:16 am
Thanks John. The difference between the mix and yield variances gives the material usage variance. The mix variance shows the effect of changing the proportion of the mix of material input and the yield shows the difference between the actual and expected yield or output.
October 30, 2018 at 4:42 pm
very helpful. thank you
October 31, 2018 at 6:52 am
Thank you for your comment 🙂
October 11, 2018 at 10:02 am
Just Brilliant!!in a nutshell
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