Managerial Accounting Chapter 8
total direct labor variance
actual labor costs compared to standard labor costs
standard cost
cost expectation for price paid and amount (quantities) used
total direct materials cost variance
difference between actual materials cost and standard materials cost
variance
difference between standard and actual performance
fixed factory overhead variance
difference between the actual fixed overhead and applied fixed overhead
variable overhead efficiency variance
difference between the actual hours worked and the standard hours expected for the units produced
direct labor time variance
difference between the actual hours worked and the standard hours that should have been worked for the actual units produced
direct materials variance
difference between the actual price or amount used and the standard amount
direct materials price variance
difference between the actual price paid per unit for materials and what should have been paid per the standards
direct materials quantity variance
difference between the actual quantity of materials used and the standard materials that were expected to be used to make the actual units produced
direct labor rate variance
difference between the actual rate paid and the standard rate that should have been paid based on the actual hours worked
variable overhead rate variance
difference between the actual variable manufacturing overhead and the variable overhead that was expected given the number of hours worked
favorable variance
difference involving spending less, or using less, than the standard amount
unfavorable variance
difference involving spending more or using more than the standard amount
standard
expectation for a component used in production
ideal standard
level that could be achieved if everything ran perfectly
attainable standard
level that may be reached with reasonable effort
flexible budget
measurement and prediction of estimated revenues and costs at varying levels of production
direct labor variance
measures how efficiently the company uses labor as well as how effective it is at pricing labor
total variable overhead cost variance
total cost variance found by combining variable overhead rate variance and variable overhead efficiency variance