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Price Variance = (Actual Price/Unit - Budgeted Price/Unit) x Actual Quantity of Output = (AP - SP) x AQ

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16y ago

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How to compute after tax salvage value?

Salvage Value - [Tax * (Market Value - Book Value)


What is the difference between negative price variance and volume variance?

Negative price variance is when the cost is less than budgeted. Volume variance is a variance in the volume produce.


Why would a favorable price variance for material might be the cause of unfavorable quantity variance?

A favorable/unfavorable price variance does not effect your quantity variance. The reason you would see a favorable price variance and an unfavorable quantity variance is because you consumed more materials than your standard allows AND the price you paid for those material was less than your standard price. If you paid more than your standard price, you would have experienced an unfavorable variance in both quantity and price.


How do you solve for price index?

To compute the price index, the cost of the market basket in any period is divided by the cost of the market basket in the base period, and the result is multiplied by 100. Price Index= P3/ Pb x 100


How do you calculate material price variances and what are the possible reasons for such variances?

Following are the causes of material price variance: 1.There could have been recent changes in purchase price of materials. 2.Price variance can be due to substituting raw materials different from the original material specification. 3.Price variance can be attributed to the non availability of cash discounts which was originally anticipated at the time of setting the price standards. 4.Changes in transportation costs and storekeeping costs can also be contributing factors to material price variance.


Why is the sales variance mutliplied by the budget price and not the actual price?

The sales variance is multiplied by the budget price rather than the actual price to provide a clearer assessment of performance against expectations. This approach isolates the impact of volume changes from price changes, allowing businesses to evaluate how well they adhered to their planned sales strategy. By using the budget price, it standardizes the variance analysis, enabling more accurate comparisons and insights into operational efficiency and market conditions.


How to compute residual variance of RIL and Sensex?

Variance is variability and diversity of security from average mean and expected value Variance = standard deviation fo security * co relation (r) devided by standanrd deviation of sensex


How do you compute discrete variables?

You do not compute discrete variables. Some variables are discrete others are not. Simple as that. You do not compute people - you can compute their average height, or mass, or shoe size, etc. But that is computing those characteristics, you are not computing people. In the same way, you can compute the mean, variance, standard error, skewness, kurtosis of discrete variables, or the probability of outcomes, but none of that is computing the discrete variable.You do not compute discrete variables. Some variables are discrete others are not. Simple as that. You do not compute people - you can compute their average height, or mass, or shoe size, etc. But that is computing those characteristics, you are not computing people. In the same way, you can compute the mean, variance, standard error, skewness, kurtosis of discrete variables, or the probability of outcomes, but none of that is computing the discrete variable.You do not compute discrete variables. Some variables are discrete others are not. Simple as that. You do not compute people - you can compute their average height, or mass, or shoe size, etc. But that is computing those characteristics, you are not computing people. In the same way, you can compute the mean, variance, standard error, skewness, kurtosis of discrete variables, or the probability of outcomes, but none of that is computing the discrete variable.You do not compute discrete variables. Some variables are discrete others are not. Simple as that. You do not compute people - you can compute their average height, or mass, or shoe size, etc. But that is computing those characteristics, you are not computing people. In the same way, you can compute the mean, variance, standard error, skewness, kurtosis of discrete variables, or the probability of outcomes, but none of that is computing the discrete variable.


Compute the current price of the bonds if the present yield to maturity is?

Compute the current price of the bond if percent yield to maturity is 7%


How do you compute ratios in airline business?

I've heard of price often being compared with passenger mileage to compute proper ticket price.


Why then should calculate a material price variance?

Material variance should be calculated to ensure that you are setting the right price for your products. When the price varies significantly, you may need to establish a new price for the product.


How do you calculate total material variance?

Total material variance is calculated by comparing the actual cost of materials used to the standard cost of materials that should have been used for the actual production level. The formula is: Total Material Variance = (Actual Quantity x Actual Price) - (Standard Quantity x Standard Price). This variance can be further broken down into material price variance and material quantity variance for more detailed analysis.