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- This topic has 6 replies, 4 voices, and was last updated 7 years ago by hemraj123.

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- November 24, 2015 at 7:37 pm #284977
Hi sir..can u help me with the following question…DECEMBER 2013 question number 5.

Sir. To solve planning variances i also revise the usage while calculating price variance..when calculatin operational variances i use the revised standars everywher as it is deemed that old standard are outdated..

The issue in the above ques is that net off operational price variance and operatinal usage variance for bedsheets comes to 1600…whereas when i calculate operational total variance it comes to 48000..its should not be..i m using the above mentioned approach..i m using revised stanadard everywhere..

November 25, 2015 at 7:49 am #285089I am afraid that there are two ways of calculating planning and operational variances, that give different answers!

The previous examiner preferred one way, but the current examiner prefers the other way.

However, either method will get full marks (even though they give different answers).If you are studying from old books, then they will use the way that the previous examiner preferred. If you are studying from current books, then they will use the way that the current examiner prefers (which is actually easier).

Our free lectures (and lecture notes) do it the way that the current examiner prefers.

However, again, either approach will always get full marks.

November 25, 2015 at 9:03 am #285123Hi sir..yeah i knw there are two approaches and i knw very well whats the difference between these two appeoaches only due to ur lectures.

Can u plz help me with that apecific question the problem that i mentioned above..

November 25, 2015 at 11:03 am #285146Revising all the standards is the ‘old’ way.

Whichever way you do it, the operational price variance for sheets is 49,600 favourable (it is always calculated based on actual quantity as per the examiners own answer).

The operational usage variance is either calculated using the original standard price (as per the examiners answer) and gives 40,000 adverse

Alternatively it can be calculated using the revised standard price, in which case it is (248,000 – 240,000) x $6 = 48,000 adverseYou have done it the ‘old’ way and the net operational variance is 1,600 favourable, which is fine – that is the total operational variance if you do it the ‘old’ way. I have no idea why you should say ‘it should not be’!

Again, the old and the new ways give different answer, and although the total of all 4 variances will be the same, it will not end up giving the same total operational or the same total planning variance.November 26, 2015 at 3:28 pm #285513pls help: yplc produces widgets, each widget should take 0.5 hours to make, std rate of pay £10 per hour. Idle time is 5% of labour paid.

actually produced 10800 units, actual pay £50,000 for 6000 hours of which 330 hours are idle – what is the labour variance? I keep getting it wrong not sure where I am going wrongNovember 26, 2015 at 3:47 pm #285515Which labour variance? Rate of pay; efficiency; or idle time?

December 7, 2015 at 4:09 pm #288561Sir, is it always the case if a mix variance is favourable then a yield variance would be adverse?

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