- May 21, 2010 at 11:50 am
Question a) i) 4) Yield variance
How did they get 5,038kg for the total standard mix @ standard quantity?
I would have done 130 batches x 45kg = 5,850kg
This question is too big to type up and scan and posting on open tuition is not allowed as its copyright protected. Any help would be appreciated. ThanksMay 21, 2010 at 9:35 pm
well dont confuse yourself with batches work in kgs.thts much simpler.see how…
if u look at the question it says that with an input of 45kgs the standard yield is 40kgs with a standard loss of 5 kgs.this in other words means that for an output of 40kgs standard allows an input of 45kgs…so for an actual yield of 4478 standard allows 4478*45/40=5038…this gives u a yield variance of 1840A.May 22, 2010 at 5:37 pm
are you fine with material usage variance? Shouldn’t it be for material A 130 x 20 = 2600 kg the standard usage? Why is it done 20/40 x 4478?May 22, 2010 at 6:54 pm
That’s what I would have done too! I don’t understand the Meaning of standard yield/standard loss.May 23, 2010 at 4:17 pm
acltang72, the question to ask for yield variance is:
How much material should it have taken to produce the actual output?
4,478kgs should have taken (45/40 * 4,478) 5,038kgs
Divide this between the materials in standard proportion then compare with actuals.
Edit: Are you asking why not use the number of batches output instead of the kgs output? Well, the results would not be comparable – Yield is a measure of loss in production and although the actual output is indeed 130 batches, it is not 5,200kgs. If I’m not explaining this clearly let me know and I’ll try again.May 23, 2010 at 6:10 pm
Sorry I still don’t get it because all other yield questions in the kit have done total actual output produced x total standard mix to get that figure?May 23, 2010 at 6:32 pm
Ah ok, I think I see what you mean. I lay it out a little differently, perhaps this way would make more sense:
Total actual yield x (std mix / std yield) = 4,478 x 45/40
The 45/40 in this example is simply a fraction – With standard yield, it takes 45kgs input to make 40kgs output. So to find out how much input 4,478kgs of output usually takes, you simply have to multiply it up by this fraction – 45/40.
The ‘total actual yield/actual yield per batch) x standard mix’ – we aren’t interested in actual yield per batch when trying to ascertain the standard yield.
I do apologise if I’m not explaining this properly, I shall keep trying though 🙂May 23, 2010 at 6:47 pm
To be honest, I usually start with input, not output when calculating yield:
5,398kgs should have yielded: 5398 x 40/45 = 4798.22222 kgs
Bit did yield 4478kgs. Difference = 320.2222222 kgs Adverse
Multiply by std cost per kg (230 / 40 = $5.75) to get $1841.28 Adverse.
I hope I’m not making it worseMay 23, 2010 at 9:25 pm
well this method is also correct acca man..and this is how its been done in the kit..the variance is same with both the methods which is 1840 A..May 30, 2010 at 1:13 pm
Do anyone of you have the answer for this question Gunge Co, part (ii), the labour variances which are cost variance, efficiency variance and rate variance? My lecturer used kg instead of batch to get the Labour Variances, the answer he got for Labour Cost Variance is 3083(A), Labour Efficiency Variance is 2760(A) and Labour Rate Variance is 323(A). I don’t understand why can’t we use the number of batch to derive the standard hours for actual output.
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