# Cost Exam 3

## 11 terms

### Material Price Variance

difference between budgeted cost of material and actual costs of materials

### Material Quantity Variance

Difference between budgeted quantity and actual quantity

### Labor Rate Variance

Difference between labor costs budgeted and actual labor costs

### Labor Efficiency Variance

Difference between labor hours budgeted and actual labor hours

### Standard Quantity Allowed

Take whatever budgeted price it applies to and multiply that by the quantity produced

### What caused the volume variance?

The over of under application of fixed MOH

### Volume Variance Calculate

To calculate find the difference between planned production and actual production and multiply by Fixed MOH rate and standard hours (if labor hours are driver) or mult planned budget * multiply by driver and Fixed MOH rate then actual production (times driver and rate) to get Volume Variance

### Volume Variance over/under

under applied: unfavorable
over applied: favorable

### Total Applied to WIP

actual output x standard hours/unit x overhead application rate

### Variable Overhead Efficiency Variance (VMOH Efficiency)

(Activity x Driver) - Actual DL Used = y
Then: y * Standard Rate VMOH
= VMOH Efficiency

### Material Price Variance Attributed

Subtract Actual price of materials per unit by standard price per unit and multiply by actual units used