Slide 1 ___________________________________ 7.2 Var ianc e - - PDF document

Slide 1

7.2 Var ianc e Analysis

Mode l for Dir e c t Mater ial Var ianc e

2005 KD Ha the wa y-Dia l

Ac tual Quantity (AQ) at Ac tual Pr ic e (AP) (AQ x AP) Ac tual Quantity (AQ) at Standar d Pr ic e (SP) (AQ x SP) Standar d Quantity (SQ) at Standar d Pr ic e (SP) (SQ x SP) Pric e Varianc e Quantity Varianc e T

• tal Varia nc e

E xhibit T 7M2-1~ Dir e c t Ma ter ia ls Var ianc e

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Var ianc e Analysis

Mode l for Dir ec t L abor Var ianc e

2005 KD Ha the wa y-Dia l

Ac tual Hour s (AH) at Ac tual Rate (AR) (AH x AR ) Ac tual Hour s (AH) at Standar d R ate (SR ) (AH x SR ) Standar d Hour s (SH) at Standar d R ate (SR ) (SH x SR ) Rate Varianc e E ffic ie nc y Var ianc e T

• tal Var

ia nc e

E xhibit T 7M2-2~ Dire c t L abor Va rianc e

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Var ianc e Analysis

Mode l for Var iable Manufac tur ing Var ianc e

2005 KD Ha the wa y-Dia l

Ac tual Hour s (AH) at Ac tual Pr ic e (AR ) (AH x AR ) Ac tual Hour s (AH) at Standar d R ate (SR ) (AH x SR ) Standar d Hour s (SH) at Standar d R ate (SR ) (SH x SR ) Spe nding Varianc e E ffic ie nc y Var ianc e T

• tal Varia nc e

E xhibit T 7M2-3~ Varia ble Manufa c turing Varianc e

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Slide 4

Var ianc e Analysis Pr

• ble m Data

2005 KD Ha the wa y-Dia l

$ 1 3 per direct labor hour Variable overhead 0 .95 hours at $9 .20 / hr Direct labor 1 .5 yards at $1 3.60 / yard Raw m aterials Standards per unit of product: 8 7 0 0 units Units produced $ 1 0 4 ,15 0 Actual variable overhead cost $ 7 7 ,900 Direct Labor costs ( 8 ,2 0 0 at $9 .5 0 ) 1 2 ,0 00 yards Raw m aterials used $ 1 8 0 ,00 0 Purchase of raw m aterials ( 1 2 ,00 0 at $1 5 )

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Var ianc e Analysis

Dir ec t Mater ial Var ianc e

2005 KD Ha the wa y-Dia l

Ac tual Quantity (AQ) at Ac tual Pr ic e (AP) ( 12,000 x$15.00) = $180,000 Ac tual Quantity (AQ) at Standar d Pr ic e (SP) (12,000 x$13.60) =$163,200 $16,800 “U”nfavor able Pric e Varianc e $14,280 “F ”a vor able Quantity Var ianc e $2,520 “U”nfavorable T

• tal Mate r

ial Var ianc e 1.5yds x 8700 units T he GOAL is for ACT UAL “A” to be le ss than Standar d “S”

How many standar d yards doe s it take to make 8700 units

Standar d Quantity (SQ) at Standar d Pr ic e (SP) (13,050 x $13.60) =$177,480 E xhibit T 7M2- 4~ Dire c t Ma terials Varianc e e xample

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Var ianc e Analysis

Dir e c t L abor Var ianc e

2005 KD Ha the wa y-Dia l

Ac tual Hour s (AH) at Ac tual R ate (AR ) (8,200 x$9.50) = $77,900 Ac tual Hour s (AH) at Standar d R ate (SR ) (8,200 x $9.20) = $75,440 Standar d Hour s (SH) at Standar d R ate (SR ) (8,265 x $9.20) = $76,038 $2,460 “U”nfavor able Rate Varianc e $598 “F ”avorable E ffic ie nc y Varianc e $1,862 “U”nfavorable T

• tal L

abor Varianc e

E xhibit T 7M2-6~ Varia ble Manufac turing Ove rhe a d Varianc e e xample

T he GOAL is for ACT UAL “A” to be le ss than Standar d “S” 0.95 hrs x 8700 units

How many Standard hours does it take to make 8700 units?

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Slide 7

Var ianc e Analysis

Var iable Manufac tur ing Ove r he ad Var ianc e

2005 KD Ha the wa y-Dia l

Ac tual Hour s (AH) at Ac tual R ate (AR ) = $104,150 Ac tual Hour s (AH) at Standar d R ate (SR ) (8,200 x $13.00) = $106,600 Standar d Hour s (SH) at Standar d R ate (SR ) (8,265 x $13.00) = $107,445 $2,450 “F ”a vor able Spe nding Var ianc e $845 “F ”avorable E ffic ie nc y Varianc e $3,295 “F ”avor able T

• tal Var

iable Manufac tur ing Ove r he ad Var ianc e E xhibit T 7M2-5~ Dire c t L abor Varianc e example T he GOAL is for ACT UAL “A” to be le ss than Standar d “S” 0.95 hrs x 8700 units

How many Standard hours does it take to make 8700 units?

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