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Hi,
In BPP revision kit questions 39.8 & 41.8 ask about materials yield variance, but there are different methods of calculation used. One in terms of litres input, other output. Which one we should be using as they give different answers?
Thank you in advance.You can do it either way, and they do not give different answer.
If you base it on litres of input then you value at standard cost per litre of input.
If you base it on litres of output then you value at standard cost per litre of output.It doesn’t matter which way you do it in the exam.
Have you watched the free lecture on mix & yield variances??
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