- August 1, 2020 at 1:57 pm #578915lchenParticipant
Good afternoon sir, may I please ask you a question from BPP exercise book question186. The question asked for Favourable material yield, but from the lecture when standard input is less than the actual input at standard price, should it be Adverse instead Favourable?
Many thanks for helping through!
- August 1, 2020 at 5:46 pm #578929John MoffatKeymaster
It is favourable,
The reason is that for the yield variance we compare the actual yield from the actual input (20,800) with the standard yield from the actual input (19,552).
The actual yield is more than it should have been and therefore the variance is favourable.
Have you watched my free lectures on this? The lectures are a complete free course for Paper PM and cover everything needed to be able to pass the exam well.
- August 2, 2020 at 2:56 am #578938lchenParticipant
Thank you sir and yes I did go through the online lecture note. I think I made the mistake by mixing example 6 from chapter 14 with this question. So we can either compare the standard input with the actual yield or compare the actual and budget yield straight away?
- August 2, 2020 at 9:57 am #578950John MoffatKeymaster
No, we do neither.
We compare the actual yield with the yield that we should have got (the standard yield) from the actual input.
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