May I be excused? My brain is full.

Variances are the differences between total actual costs and total standard costs. When the actual costs exceed the standard costs, the variance is UNFAVORABLE (negative connotation). If the actual costs are less than the standard costs, the variance is FAVORABLE (positive connotation).
* Total materials variance : [Actual Quantity(AQ)xActual Price (AP)] - [Standard Quantity(SQ)x Standard Price (SP)] = Total Materials variance (TMV)

* Materials price variance : (AQ x AP) – (AQ x SP) = MPV

* Materials quantity variance : (AQ x SP) – (SQ x SP) = MQV

* Total labor variance : [Actual Hours (AH) x Actual Rate (AR)] - [Standard Hours (SH) x Standard Rate (SR)] = Total Labor Variance

* Labor Price Variance : (AH x AR) – (AH x SR) = LPV

*Labor quantity variance : (AH x SR) – (SH x SR) = LQV

* Total OH variance : Actual OH – OH applied = TOV

* price variance = overhead controllable variance
Actual OH – OH budgeted = OCV

* quantity variance = overhead volume variance
Fixed OH rate x (Normal Capacity in hours – standard hours allowed) = OVV

My God...managerial accounting is WORSE than the military with its damn acronyms. My head hurts. One more day and I'll be DONE DONE DONE with this class!!! I pray I make it that far.


- hfs