COST ACCOUNTING
STANDARD COSTING AND VARIANCE ANALYSIS
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Labor Rate Variance
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Labor Mix Variance
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Labor Efficiency Variance
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Total Labor Variance
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Detailed explanation-1: -Yield variance is a measure of the difference in output. Meanwhile, mix variance is the difference in overall material usage or inputs. Specifically, material usage can vary because a mix of products or inputs is used, which are different from the standard mix.
Detailed explanation-2: -The total Labor variance. The sum of labor rate variance and labor efficiency variance is equivalent to the total labor variance.
Detailed explanation-3: -BusinessAccountingThe sum of the material mix and material yield variances equals the total material variance. the volume variance the material quantity variance. the material purchase price variance.
Detailed explanation-4: -(ii) When Standard and actual times of the labour mix are different : Changes in the composition of a gang may arise due to shortage of a particular grade of labour. It may be calculated as follows : LMV = (RSH-AH) x SR Where, Revised Standard Hour (RSH) = Total Actual Hour/ Total standard hour X actual hour.