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Hi there,
how do you work out the material usage variance (FOR mixed variance)?
I used the same methodology and got that the difference of actual usage (15200kg) and standard usage for actual production (3kg x 5000units = 15000kg) was 200kg.
I know that you have to multiply the 200kg by the standard cost but as there are 2 materials used, I can’t seem to get the $300, which is what you get when you just subtract the mixed variance from the yield variance.
I’ve tried using the standard mix but that gave me:
material X 133kg x $3 per kg = $399
material Y 67kg x $2 per kg = $134so it is not the $300
please help
As always, you compare the actual purchases (9,900 and 5,300) at standard cost, which comes to $40,300, with the standard purchases for actual production at standard cost, which comes to $40,000.
You didn’t use that layout for example 1, which is why I’m confused.
You just got the materials left, and then times it by the standard cost
but the rule you mentioned above stands for all material usage variances right?
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