2) The Yield Variance (Material or Labor) Note: This is the second of the two sub-variances of the total quantity variance. The yield variance results from a difference between the total actual quantity of the inputs that were used to produce the actual output and the total standard quantity of inputs that should have been used to produce the actual output. The formula to calculate the yield variance is a variation of the quantity variance of the mix: (AQ – SQ) × SP. Instead of using the standard price of a single input, we use the weighted average standard price of the standard mix, or waspSM. (This is the same waspSM as was used in the calculation of the mix variance [above].) The yield variance is calculated as follows: Actual Total Quantity of All Inputs – Standard Total Quantity of All Inputs × Weighted Average Standard Price of Standard Mix of All Inputs or (AQ – SQ) × waspSM
Posted on: Fri, 03 Oct 2014 11:40:51 +0000
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