Standard Costing and Variance Analysis Formulas
Standard Costing and Variance Analysis Formulas:Learning Objective of the article:
This is a collection of variance formulas / equations which can help you calculate variances for direct materials, direct labour, and factory overhead.
Direct Materials Variances:Materials purchase price variance Formula: Materials price usage variance formula materials quantity / usage variance formula Materials mix variance formula Materials yield variance formula Direct Labor Variances:Direct labor rate / price variance formula: Direct labor efficiency / usage / quantity formula: Direct labor yield variance formula: Factory Overhead Variances:Factory overhead controllable variance formula: Factory overhead volume variance: Factory overhead spending variance: Factory overhead idle capacity variance formula: Factory overhead efficiency variance formula: Variable overhead efficiency variance formula: Variable overhead efficiency variance formula: Factory overhead yield variance formula: *Fixed overhead budgeted + Standard hours allowed × Standard variable overhead rate **Standard hours allowed for actual production × Standard overhead rate ***Fixed overhead budgeted + Actual hours worked × Standard variable overhead rate

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