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Before watching the last part of the lecture on efficiency variances under ABC I tried to solve it myself. I did end up with the correct answer, but the way I went about it was the opposite of what was shown in the lecture so I want to be sure if the way I did it is correct.
I took the difference between the actual units and the standard units for actual despatches.
Actual units: 50400
Standard Number of Units for Actual Despatches: 2200*(48000/2000) = 52800
Therefore we made 2400 units less than we should have, and we multiply that by the standard cost per unit to get the variance.
2400*(120000/48000) = $6000 (A).
Is this way of doing it fine, or should I stick to the method shown in the lecture?
Both your method and the one presented in the lecture yield the same result, so it is fine to use your approach as long as it is consistent with the principles of variance analysis.
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