When calculating sales price varaince why do u multiply the formula with actual qty and not budgeted qty? isn't it supposed to be budgeted bcs we are looking at the change in price? if we take actual qty, doesnt the variance also include the qty change?
No, that logic applies when calculating volume variance. But for price variance, the logic applied is that.. whatever is differential in prices, that will affect the business profits on the actual qty sold. For example, if zero qty is sold during a period, then doesnt matter even if selling price is high or low, effect on profit will be zero.
Following two videos are put on Clubs (Non profit organisations): Video 1 covering basic IGCSE concepts: ua-cam.com/video/yihobeKNL44/v-deo.html Video 2 covering advanced A level concepts: ua-cam.com/video/uNcHHvPNBLk/v-deo.html
you said never to calculate variance with budgeted data but standard data and then in case of sales variance you calculated with the budgeted data... can you explain this part sir?
Yes if you watch Part 2 i mentioned in that video that only for cost variances the calculation has to be done between actual and standard data. for sales variances, it has to be done as shown in the video.
keep on making such videos sir may God bless you
i immediately clicked
Thank yu sir ...May your Lord bless yu 🤗
saving my life, god bless you
This really helped..thank you
When calculating sales price varaince why do u multiply the formula with actual qty and not budgeted qty? isn't it supposed to be budgeted bcs we are looking at the change in price? if we take actual qty, doesnt the variance also include the qty change?
No, that logic applies when calculating volume variance. But for price variance, the logic applied is that.. whatever is differential in prices, that will affect the business profits on the actual qty sold. For example, if zero qty is sold during a period, then doesnt matter even if selling price is high or low, effect on profit will be zero.
Can u put a video on clubs and societies
Following two videos are put on Clubs (Non profit organisations):
Video 1 covering basic IGCSE concepts: ua-cam.com/video/yihobeKNL44/v-deo.html
Video 2 covering advanced A level concepts: ua-cam.com/video/uNcHHvPNBLk/v-deo.html
Investment appraisal??
Will upload soon.
you said never to calculate variance with budgeted data but standard data and then in case of sales variance you calculated with the budgeted data... can you explain this part sir?
Yes if you watch Part 2 i mentioned in that video that only for cost variances the calculation has to be done between actual and standard data. for sales variances, it has to be done as shown in the video.