jas22 – I set up the material and labor variances the same way every time (PURE ASAS)
P=AQ(SP-AP); AQ=Actual quantity purchased
U=SP(SQ-AQ) AQ=Actual quantity used; SQ=Actual output * Std per unit
R=AH(SR-AR)
E=SR(SH-AH)
Im usually able to get those questions correct based on that.
Then for the tormentors: Spending, Efficiency and Volume Variances
I have re-written these formulas more times than I've written my name.
Actual OH – usually given in problem
Budget OH amount based on actual DLH worked = Budgeted FOH + (Actual DLH worked * Std VOH rate/DLH)
Budget OH amount based on std DLH allowed = Budged FOH + (Std DLH allowed * std VOH rate/DLH)
OH Applied = (Std OH rate/DLH)*std DLH allowed
I don't know if you have the ninja notes or audio but Jeff emphasizes that variable OH is based on ACTUAL activity and fixed OH is based on NORMAL activity. I must say that to myself 50 times a day when reviewing these problems and I found that has helped. I suggest re-writing the formulas over and over.
A - 75
B - 78 God is good.
F - 77 Answered prayers.
R - 84! Done!!
Paperwork sent - waiting for license!!
Still on a cloud and in shock. Through God, all things will happen.
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