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in the BPP study material,Section C Solutions ,exercise number 10 Linsil, I didn’t understand how the variances were calculated, I tried the same question by calculating material price and usage separately but it didn’t give the same total planning and operation variances . why in calculating the operational variance, original standard price was not used?
I assume that you are referring to an exercise in the Study Text. However I do not have the Study Text – only the Revision Kit – and so I cannot really comment on what they have done.
It could be because there are two ways of calculating planning and operational variances, which are both sensible but give different answer. The previous examiner preferred one way, but the current examiner prefers the other way (which is also easier). However both ways get full marks in the exam.
The way that I show in my free lectures is the way that the current examiner prefers.
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