04 January 2008
+YOUR QUERY INITSELF IS ITS REPLY. ANY DIFFERENCE IN STANDARDS PARAMETERS AND ACTUAL DATA NOTICED AT THE END OF PERIOD TO BE MONITORED IS THE VARIANCE WHICH MAY BE PLUS OR MINUS. IT MAY QUANTITIVE AND VALUE BASED . THANKS S.K.GUPTA
04 January 2008
Material Variance is to be calculated with formula = Standard Material Cost - Actual Material Cost.At the time of calculating Standard Material Cost, we should multiple Standard Quantity of Actual Output with Standard Price.
Labour Cost Varinace is to be calculated with formula = Standard Labour Cost - Actual Labour Cost.At the time of calculating Standard Labour Cost, we should multiple Standard Hours of Actual Output with Standard Rate.
The Material Variances Subdivided PRICE, MIX, USAGE, SUB USAGE & Total Material Cost Variance
Labour Variance Subdivided RATE, MIX, EFFIFICIENCY & Total Labour Cost Variance.
04 January 2008
please refer vahist and saxena book for cost accounting in which they have given wonderful formula for this.But without understanding the concept it may not be possible to apply that formula.
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