okay so this is regarding methylene mix and yield a company used to materials p and q then they give you usage for one units product okay it requires five kilograms of p and 10 kilograms of q during june 80 units of output all right will produce from 500 kilograms p and 730 kilograms cube calculate material usage variance method remix and material yield variance okay now can you calculate material usage variants before i proceed with make and yield three minutes calculate material usage variance so when you calculate material usage make sure you cut it separately for p and q upper familiarity standard quantity of actual production i show you uh one example until you calculate another one let's say formatted p okay standard quantity of actual production formulary and quantity of virtual production compare actual quantity of material use and then multiply by standard price sustained quantity for negativity five kilograms okay five milligrams of actual production means you multiply by ratio production then you compare with actual quantity of material use question silence how many kilograms we purchase and how many kilograms we use so we assume that this is a same figure you believe 500 is 500 and then you multiply by price this is price for material p then you solve this equation you will get the answer okay 200 200 200 good or bad ever say okay bad result because uh you plan this one 400 you plan to produce the product using 400 kilograms of material but then you use more you use 500 so when you use more you have to pay more cost increase bad result that's why address okay now two minutes cut it mercury usage for cube this okay now now we proceed with material mixed variance so for mix and yield if you have question for mix and yield okay uh and they just align mix and you prepared this so you happy and q um you okay lee bro [Music] okay [Music] okay um all right can you proceed with this one yes my name is okay material mixed variance formula is aqam aqsm multiplied by standard price so you draw this table okay you draw this table you have a is foreign [Music] um [Music] which one m one column for actual another column for standard okay you have p and q so for actual this is your actual right so my therapy actual is 500 kilograms my theory q 730 kilogram so total is actually one two three zero this represent your aq okay aq remember mathematics variance formula aqam compared with aqsm multiplied by standard price okay so uh so your am is actually fractions okay fractions for from this column 500 over one two three zero for material p material q seven thirty over one two three zero if you have a question on mix and yield please prepare this table okay so this is actually your am am for battery p and am for battery q then standard this is your standard 5 kilograms for p 10 kilograms for q so total 5 plus 10 is 15 all right and then fractions for material this is sm sm remember sm anti-muslim formula 5 over 15 and uh p and mercury q is 10 over 15 okay now we substitute into our equation you must calculate separately for p and q okay for p and q let's see for p a q a aq is one two three zero this one is one two three zero multiplied by a m a m for material fee this one 500 over one two three zero compare with a q again okay a q s m a q one two three zero s m this is your s m four b instead sm is actually standard mixing standard mix for material b 5 over 15. put in bracket then you multiply by standard price standard price for material b 2 ringgit per kilogram multiplied by two okay you solve this equation so you have 500 compared with how many years now one two three three zero 400 410 first then you multiply by two okay 180 very good 180 is the answer all right dc standard right this is standard this is actual that means when you interpret the result start from standard to actual okay starts from standard to actual so you plan to produce the product using 410 kilograms of material but then you use 500 kilogram bad result cost increase adverse okay so for variance make sure you have correct figure and all right now three minutes can you calculate mixed variance for material p and battery cube calculate mixed is okay next material yield variance for material yield variance formula is a actual yield compared with standard yield then multiplied by standard cost actual yield referred to actual production standard yields means your company of budgeted production okay based on actual performance so your budgeted productions you you can calculate okay you can calculate based on this value one aq divided by 50 standard cost standard cost is this one this is your standard cost just substitute into our equation okay actually is 80 units standard yield 1 2 3 0 divided by 15 standard cost is 40 ringgit okay you so 80 1 2 3 0 divided by 15 you will get 82 compare is 82 multiplied by 40 so you solve this equation you will get ap right yes it is standard actually you plan to produce 82 units but then you produce ap units only that means uh when production reduce you can sell less quantity revenue reduced bad result adverse candidates for usage varies just now and then mix variance for material q 7 favorable then we proceed sales variant this one also under traditional variance you have two methods the number methods of profit matters okay under the novel method you have sales price variance standard selling price compared with actual selling price then multiply by actual quantity so quantity sales quantity variance quantity varies means in record you compare two different quantity two different volume then multiplied by standard margin standard matches means profit standard profit money negative profit selling price total cost mixed variance okay a q a m but then a q a m s m [Music] [Music] okay now we look at sharikat watcher sharikat raja sutra produce single product mega and operate standard costing system a production budget for may okay remember to calculate material cost variance you calculate material price variance then you compare with material usage variance you have two types of material recorded separately labor variance labor cost varies you compare labor rate variance with labor efficiency variance okay labor rate and labor efficiency in case so you can try on your own and this one you try on your own and then you will add mix material mix variance equipment dm ethereum experience requirement e material yield variance what's new antibody checked even recorded all right um traditional variance okay before this when you do your traditional variance you compare standard with actual actual data okay let's say in terms of material price variance okay whereby you compare standard price with actual price you multiply by standard quantity let's see price your pre-determined value price of material earlier you determine at 10 ringgit per kilo and then actual is actually 15 ringgit per kilo okay so you compare 10 and 15 ringgit 10 and 15 ringgit when you do traditional variants sometimes during the production process okay during production process price of materials may goes up again may increase maybe due to high demand for that particular material and there is a shortage of supply so price increase middle of the year for example maybe increase to 14 ringgit okay increase 240 ringgit so when there is increase in uh price not only price okay in terms of usage maybe label so when there is changes in data you need to analyze your variance into planning and operational variance okay so when you calculate plating variance you compare these two figures when you calculate operating variance you compare these two figures it depends on types of variance why do you need to calculate your planning operational values because when there is changes during the production process your previous data or maybe your performance your previous data may be outdated therefore your performance you cannot rely on these results okay to evaluate performance of your uh workers or maybe performance of your production process okay so traditional variance has limitations because it does not consider if original standard becomes outdated because of that they introduce planning and operating variants okay so planning and protein varies will give you more meaningful comparison between actual performance and standard all right so planning value is uncontrollable by operational management you compare this one is unconstructed lending bearing is uncontrollable you cannot control however you can control your operating variance why because when you compare this one you cannot control it this one you cannot control so you make whatever comparison and then you interpret the result but then you adjust with operating variance you can control your uh this this process this stage you can control so that you will have positive result at the end of the reduction process okay what are the benefits of operating variance it makes standard costing and variance more realistic and meaningful up to date okay to current level of operating efficiency so it will give you more meaningful variance okay it emphasis on importance of planning functions in preparations of standard and helps to identify planning the efficiency if there is problems with your planning then you can adjust okay so that your operating variance uh shows positive results what are the problems of planning variance uh it is subjective difficult to determine actual uh value actually and then every time there is changes in value you must recalculate so it involves clerical works okay because of that because of these uh problems you will not calculate planning operating variance for all course items okay you will not calculate planning operating values for all cost item you will select okay the one that shows significant value let's see previously all variant shows and shows a favorable result suddenly one or two variant shows adverse result so you will investigate uh the one that shows adverse results only okay that means you select variance why because of limitations that i mentioned earlier because of these are problems so that process is known as management but exceptions only significant cost variants are reported and investigate so when you investigate means you calculate planning operating variance for that particular cost item only so which variants are significant how to determine whether that particular variance are significant and or not you look at these factors okay you must consider these factors look at the trend size of variance controllability of the cost item recurrence and also favorable varies so the benefits from investigations of course must exceed cost of investigations what are the costs for invest various investigations costs include time spent to investigate the problems sometimes it involves disruptions of a production process again because you need to investigate the reason why you must stop your production cost of implementing corrective action when there is negative results you need to take rectified sheets benefits include reduced cost of the causes of the variance is eliminated eliminate okay if you can eliminate causes of the variance then you will get benefit from that and then causes a favorable variance may improve work practice this is the benefit so in this case management skills and experience allow managers to wake up these considerations whether you have more benefit or cost is more than benefits if you expect that benefit is more than cost then you can proceed with your investigations okay this is advantage of course uh standard cost standard costing limitations please read it on your own what are the criticism of standard costing in relation to modern manufacturing environment because of this pre-disease season they come up with splendid and operating variants are the problems exists when you set standard what are the behavioral implications when you set standard this one also important you must read what are the factors that influence behavior okay now to illustrate planning and operational variance we look at these two questions seduct battery and rory mega okay look at seduct bakery first okay before that okay i explained again and the traditional various let's say material cost variant level cost variant overhead variance sales variance you compare original and actual okay you compare original and actual so when there is changes during the production process you revise you uh may reverse at a point there is changes this is let's say changes in so when there is changes maybe you need to determine planning and operating variance so to calculate planning variance you compare these two figures to calculate operating values you compare these two cost items or data see in terms of material price variant so when you determine material price varying just now it considers standard price okay with actual price and then quantity you refer to actual quantity however when you do planning variants okay when you do planning varies you compare original standard price with a revised price and then your quantity revised quantity meaning a floater when you do operating variance you compare revise standard price with actual price but then quantity you refer to actual quantity okay this one for material material price variance how about material usage variance when you do traditional variance material usage variance standard quantity of actual production compared with actual quantity multiplied by standard price so when you do planning variant standard quantity of actual production compared with revised quantity but then price you take original price standard price for operating variance revise standard quantity revised quantity compare with actual quantity but then your price you consider revised standard price okay this one for material usage variance again when familiar mentioned of actual production means you must multiply by actual quantity of finished goods produced okay now we look at seduct bakery okay we look at that bakery so let's see that bakery [Music] peace that's it okay then vermont you look at that bakery read the question first [Music] look at your question look at your questions set up bakery produced a product called cake laptop bakery you you print out that so let's let's say that bakery okay illustration that you got tutorial so that bakery produced a product called cake lapis monas and use standard costing system to cause its product its production budget for march 2012 is as follows material m ten thousand kilograms fifteen thousand ringgit mercury fifteen thousand kilograms twenty eight thousand five hundred ringgit now you can calculate a cost per kilo cost per kilo for material m 15 000 ringgit just divide by 10 000 kilograms 28 500 divided by 15 000 one ringgit ninety cent price per kilo standard price and then level two thousand hours eight ringgit eight thousand ringgit jetty uh one hour for ringgitler one hour for the gate and then production cost ten thousand units okay product should cost for ten thousand units m for one you need finished goods material m ten thousand kilograms for ten thousand universities one unit one kilogram material k 15 000 kilograms material for 10 000 units produced so one unit 1.5 kilogram level black vapor 2 000 hours divide by 10 000 units product 0.2 hours okay if it's overheated okay during the months allocated direct level hour per unit is expected to increase by five percent highlight increased by five percent this is changes wage rate likely to increase to six ringgit per hour okay wage rate just now for ringgit right earlier hour you buy foreign four gate now they got the increase to six ringgit changes there the price of metric m has been revised to three ricket earlier a m m ringgit ok your revised data increased to 3 ringgit due to increase in market price usage of material m and k will be reduced by 20 from the required quantity so this is required quantity the cutter reduced by 20 percent 20 percent the usa uh due to better quality materials okay last paragraph actual results material m and k 12 000 kilogram okay metric also 12 000 labor two thousand eight hundred twenty hours and then production cost for nine thousand four hundred units so your actual unit produce nine four zero zero then look at requirement calculate the following variance mechanics lab material and labor yield variance material price planning variance material usage operating variance for medicaid labor rate planning and operating variance so i can use a tool into illustration material price planning varies number three material price planning variance for material material and subject price planning varying dedicated price planning variance standard price remembers compares price standard price width revised price multiplied by revised quantity so you open your standard price one you can get 50 cents okay compare with actual price is three ringgit and then revise standard quantity earlier earlier one unit requires one kilogram right one unit is one kilogram now you minus twenty percent super upper tingle zero point eight 0.8 kilograms one unit requires 0.8 kilograms of actual production means you multiply by a tube you need produce 9400 units then you solve this equation you will get the answer you plan to produce what you plan to produce the product you plan to pay 150 cents for material m but then you have to pay more you pay three ringgit so adverse results can you follow glass 12 thousand one point two one four one point two one nothing one point two one that's why that's why you kill us about figure the plate okay it's your quantity it's your quantity a mixture of thousand kilograms because question silence can assume reputably so three minus one point two one multiplied by twelve thousand twenty one four eight zero yes it's twenty one four eight zero you plan to pay three ringgit but then you pay less than three so good results ready with the operating variance you are continuing the revised actual planning variance you can get the original standard revised to interpret the results saying okay now interpret results okay then keep the try material usage operating variance for bacterial key material usage operating variants for material diagram okay make it a usage oh okay let's take it about material usage operating variants for medicaid material usage operating assembly one depending foreign material usage operating variants for materials operating variants just now [Music] 1.5 minus 20 [Music] okay 1.2 kilogram so familiar material usage variance standard quantity of ratio production compared with actual quantity multiplied by a standard price so operating variance revise revised quantity compared with actual price then multiply by revised price compared with the actual quantity then you multiply by reverse price when you do usage value make sure in bracket you compare two different quantity now your revised quantity 1.2 of actual production means you multiply by actual production 9400 then you compare with actual quantity of material for actual quantity of material 12 000 kilograms given under second table about revise rate 90 cents okay so 1.2 multiplied by nine thousand four eleven to a zero compare with twelve thousand multiply by one point nine okay can you solve the equation you will get one three six eight one three six eight good or bad we plan to produce the product using eleven thousand two hundred eighty but then we use more so adverse results okay it was resourcing okay then last into labor rate planning and operating variance okay labor rate blending and operating variance so i basically need low now okay into labor labor rate labor rate variance you compare standard rate and actual rate multiplied by actual hours so when you do planning variance you compare original rate and revise rate when you do operating variance revise rate compare with actual rate can you hear my voice class [Music] all right all right very good then if let's say we do uh labor rate planning variance okay labor rate planning variance so standard rate just now following it right we can click earlier following it labor rate and then revise look at a second paragraph the wish rate is likely to increase to six ringgit okay revise rate six we get and then allocated data level hours polluted expected to increase by five percent originally two thousand hours for ten thousand units two thousand hours for ten thousand units that means one unit zero point two hours now the cutter increased by five percent means zero point two one plus five percent or multiplied by one point now revise hours 0.21 for one unit product it's your production just now 9 400. okay you solve this equation you will get the answer you plan to fade to pick following it but then you have to pay more definitely at first result 3948 okay for blending variancy operating variance but okay into operating variance since this is level rate operating variance revised rate 30 6 thousand eight hundred twenty hours so one hour means how much eight four six zero divided by two eight two zero three ringgit right you compare with three ringgit actual hours to eight to zero you plan to pay six ringgit but then you pay less than six good results eight four six zero now i give you five minutes can you try mix material mixed variants a1 a2 material and label yield variance five minutes say what a1 and a2 the only previous lesson foreign okay check your answer for material makes very remember when you have meta remix variance please draw a table that i informed earlier okay material makes for material m 2006 adverse metallica four five six zero fever but apart that got the bloodless [Music] yield variance in case then the first you calculate [Music] [Music] [Music] is 2.5 okay one over two point five any one point five over two point five nine me [Music] foreign 9004 and then aq are giving us 100 30 divided by 2.5 you solve the equation you're gonna pass 870 at best and then label extended cost per level 8 000 divided by 10 000 8 000 ringgit divided by 10 000 units so unique product cost 80 cents indian labor yield variance 9004 compare with to 8 to 0 divided by 0.2 okay remember this are two sizes so you just update uh foreign um okay comedian keep the proceed in the next questions that's it good die can you die so when you do planning a material price variance you compare will a price vary means you compare to different price for planning variants you refer to original and revised okay and then you search various you compare quantity two different quantity of material material usage variance operating varies again you refer to reverse and actual quantity okay then okay now rory maker okay rory maker um look at look at ronnie megan requirement a complete the following variance material mixed material yield level mix level yield prepare separately for material and label part b labor rate planning and operating variance okay look at the question rory mega brhad used an automated manufacturing process to produce an electronic product known as mega the firm operate standard marginal costing system budgeted monthly production is four thousand five given below our cost data for one unit mega highlight one unit mega swedish use standard into one unit so that bakery debuggy you budgeted production right you have the three types of material material abc skill level and skill level and then actual production during months of november was four one five zero units detail of actual expenditure inc were as follows material a b and c so below whatever actual you you list down uh for actual column material a 48150 at b 41 925 material c 29.925 kilograms then total up your canapa aq standard number okay during the period the company purchased a new machine using letter technology for production of mega due to this skill level hours per unit will reduce by 2 hours skill labor planning and operating balance okay now i give you uh 10 minutes answer these questions both requirements a and b 10 minutes keep that [Music] recording you