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Standard Cost = Standard Quantity x Standard Price
Actual Cost = Actual Quantity Used x Actual Price
Standard Quantity Allowed (SQA) = Units Produced x Standard Quantity per Unit
Actual Cost
Standard Cost (SQA x Standard Price)
Cost Variance
$ XX
(XX)
$ XX Unfavorable(U) / Favorable (F)
Materials:
AQU = Actual Quantity Used
AQP = Actual Quantity Purchased
AQ = Actual Quantity
SQA = Standard Quantity Allowed
AP = Actual Price (Paid)
SP = Standard Price
UP = Units Produced
Actual Cost (AQU x AP)
Standard Cost (SQU x SP)
Materials Cost Variance
$ XX
(XX)
$ XX U/(F)
SQA = UP x SQ per unit
Analysis:
Price (Usage) Variance [(AP - SP) x AQU]
Quantity Variance [(AQ - SQ) x SP]
Materials Cost Variance
Purchase Price Variance = (SP - AP) x AQP
Labor:
AH = Actual Hours
SHA = Standard Hours (Allowed)
AR = Actual Rate (Paid)
SR = Standard Rate
Actual Cost (AH x AR)
Standard Cost (SHA x SR)
Labor Cost Variance
SHA = UP x SH per unit
$ XX
(XX)
$ XX U/(F)
$ XX U/(F)
XX U/(F)
$ XX U/(F)
Analysis:
Rate Variance [(AR - SR) x AH]
Efficiency Variance [(AH - SH) x SR]
Labor Cost Variance
$ XX U/(F)
XX U/(F)
$ XX U/(F)
Overhead:
AMO = Actual Manufacturing Overhead
SM = Standard Manufacturing Overhead
AH = Actual Hours
SH = Standard Hours
NH = Normal (Capacity) Hours
SVOR = Standard Variable Overhead Rate (per hour)
SFXOR = Standard Fixed Overhead Rate (per hour)
SOR = Standard Overhead Rate (per hour)
BFXMO = Budgeted Fixed Manufacturing Overhead
BASH = Budgeted Allowed Based on Standard Hours
BAAH = Budgeted Allowed based on Actual Hours
VOBAH = Variable Overhead Budget based on Actual Hours
AVMO = Actual Variable Manufacturing Overhead
AFXMO = Actual Fixed Manufacturing Overhead
Actual MOH
Standard MOH (SHA x SOR)
MOH Cost Variance
$ XX
(XX)
$ XX U/(F)
Analysis:
2 Variance Method:
Actual MOH
BASH:
FXO (SFXOR x NH)
$XX
VO (SVOR x SH)
XX
Controllable/ Budget Variance
$ XX
BASH
SMO (SH x SOR)
Volume Variance
$ XX
(XX)
MOH Cost Variance
Alternative for Volume Variance:
Volume Variance = (NH - SHA) x SFXOR
(XX)
$ XX U/(F)
$ XX U/(F)
$ XX U/(F)
3 Variance Method:
Actual MOH
BAAH:
FXO (SFXOR x NH)
VO (SVOR x AH)
Spending Variance
$ XX
$XX
XX
(XX)
$ XX U/(F)
BAAH
BASH
VO Efficiency Variance
$ XX
(XX)
$ XX U/(F)
Volume Variance [(NH - SH) x SFXOR]
$ XX U/(F)
MOH Cost Variance
$ XX U/(F)
Alternative for VO Efficiency Variance:
VO Efficiency Variance = (AH - SH) x SVOR
4 Variance Method:
Actual Variable MOH
VOBAH (SVOR x AH)
VO Spending Variance
$XX
XX
Actual Fixed MOH
BFXMO (SVFX x NH)
FXO Spending Variance
$XX
XX
$ XX U/(F)
$ XX U/(F)
VO Efficiency Variance [(AH - SH) x SVOR]
$ XX U/(F)
Volume Variance [(NH - SH) x SVOR]
$ XX U/(F)
MOH Cost Variance
$ XX U/(F)
Other computation for Volume Variance:
Fixed OH Efficiency Variance [(AH - SH) x SFXOR]
Idle Capacity Variance [(NH - AH) x SFXOR]
Volume Variance
$XX
XX
$ XX U/(F)