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Total actual quantity= 23478kg. standard loss is 10% and standard yield is 360 grams per unit. Actual units produced 60000. standard price is 0.302 per unit. WHAT IS YIELD VARIANCE?
can someone help me with explanation?correct me if im wrong, but im going to try and answer it for you!
0.360*60000 = 21600kg to produce 60000 (std)
actual = 23478kg to produce 60000so you get actual figures of 23478 and deduct 21600 which equals 1878 then multiply by std cost of .302 which equals 567 favourable
i think that is right, normal loss is ignored (i think).
i tried to help, if im wrong, then its going to be with the normal loss!
if the normal loss is deducted, then its 23478 – 21600 – 2160 x 0.302 = 85.16 adverse
i hope the first answer is correct as i have just sat and learnt it!
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Refer to willynwilson, 21600kg is the standard usage before standard loss of 10%, this mean that they know there will be standard loss of 10% and therefore they will allow for it, 21600kg will be 90%, adjusted standard usage = 21600 x 100/90 = 24000kg.
Then (24000 – 23478) x $0.302 = $157.644 favourable, lesser amount of quantity is used resulting in a favourable yield variance 🙂
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0.36 grams per unit is after loss. Before loss was subtracted the standard was 0.4 gram per unit.
Actual
60000 Units
Standard( 23478 / 0.4 ) 58695 units
Difference
1305 unitsYield Variance is 1305*0.302= 394 F. This is the Answer.
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Sorry I used kg rather than units,lol yes smmysterious is right, 0.36kg per unit is 90%, 100% is 0.4kg per unit.
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