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Sir, I am confused with one of the practice questions…more variance analysis chpt second question…sir the working done looks more like of productivity variance not of efficiency…Shouldn’t we just do ((1.5/.9)x20000)-38000)×15
No – the workings are correct.
As always with the efficiency variance we are comparing the hours actually worked (which were only 35,000 hours) with the standard hours for the actual production which is 20,000 x 1.5 = 30,000. There is no such thing as a productivity variance.
Have you watched the free lecture on excess idle time variances (because there is no point at all in using our lecture notes if you are not watching our free lectures – they are simply lecture notes!).
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