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Dear John, You are healthy and Happy.
I understood that in mix variance one will be adverse and another will be favorable, as one is replacing another.
But i didn’t really see the logic behind why if yield variance is adverse , the analysis ( X & Y ) both materials will have adverse yield variance & vice versa.It just hit me while i was asking , It it because we used extra total materials and The propotion of the material mix is always 100 % , and even if we use extra than we should have then it will be in same propotion. like if 100 Kg was over all wastage; it was in same actual propotion of material mix ?
Yes – that is the reason.
If the mix remains at standard and the total used is more, then it will be more for each of the materials.
it might be silly to ask, But when question asks to “analyse” a yield variance, does it mean to do yield variance for both X and Y material. Or will it simply ask to do particular variance for each material.
Also, Am i always supposed to comment in section C even when its not asked explicitly ?
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