"Why we times budgeted profit per unit or budgeted contribution per unit? This is because when the sales volume changes, the production cost also will change." Greatest explanation ever! I really don't know why those expensive textbook cannot managed to explain this logic in this simple and easy way! Thanks!
now i have hope, and i am waiting patiently for the upload of budget preparation lecture, short term decision making and throughput costing and i check everyday for the notificication please please kindly upload
Hi, not to worry I will be uploading soon, unfortunately I can't give you the time, because I'm working on relevant costing at the moment. Please bear with me. Thanks
It's called the total sales margin variance, you can calculate this variance by using this formula: Budgeted sales quantity x (Budgeted selling price per unit - Budgeted cost per unit) Less Actual sales quantity x (Actual selling price per unit - Budgeted cost per unit). You've to use the budgeted cost for both. Hope this helps
Yes, you are right. The total variance is the addition of the individual variances. Using the above formula, if you get a positive answer, then it's a (F) variance and a negative answer means it's an adverse variance.
Hi, thank you for the query. You always have to use the budgeted contribution per unit because the standards are set by the top management of the company so they would want to know (the variance) or how much they've gained or lost in their money value and not in the actual money value. If you refer material usage variance or labour efficiency variance, we use the standard rate and not the actual rate for the same reason I've mentioned above. So the rule is in standard costing when you convert any variance in money value you must use the standard rate. I think I've mentioned this in one of my videos but sorry can't remember exactly on which one. Hope this helps.
You are a VERY good teacher. Perfect and clear to understand. Thank you so much 🙏
Many thanks for your comment. So sorry for the delay in uploading the videos. I'll be uploading very soon.
"Why we times budgeted profit per unit or budgeted contribution per unit? This is because when the sales volume changes, the production cost also will change."
Greatest explanation ever! I really don't know why those expensive textbook cannot managed to explain this logic in this simple and easy way! Thanks!
Many thanks for the lovely comment
Thank you very much for these videos. Real life savers
Thank you so much. Please bear with me, I'll upload more for you.
Thank you soo much .Its really easy and deep down explanations
please add more videos.
Many thanks Prasad, I'll definitely. I'm working on the break even point, I'll upload ASAP.
Very clear. Thank you for the lectures
Thank you, I'll try and upload more videos.
now i have hope, and i am waiting patiently for the upload of budget preparation lecture, short term decision making and throughput costing and i check everyday for the notificication please please kindly upload
Hi, not to worry I will be uploading soon, unfortunately I can't give you the time, because I'm working on relevant costing at the moment. Please bear with me. Thanks
Thank you
very helpful this one
Thank you, I'll be uploading more for you guys.
@@managementaccountingmadeea5236 Thanks so much
Hello, how can i calculate total sale variance ? is there any formula except we take sales price variance + Sale volume variance ?
It's called the total sales margin variance, you can calculate this variance by using this formula:
Budgeted sales quantity x (Budgeted selling price per unit - Budgeted cost per unit) Less Actual sales quantity x (Actual selling price per unit - Budgeted cost per unit).
You've to use the budgeted cost for both. Hope this helps
@@managementaccountingmadeea5236 Thanks, but this formula, in essence, is still sales price variance + sales volume variance, right ?
Yes, you are right. The total variance is the addition of the individual variances. Using the above formula, if you get a positive answer, then it's a (F) variance and a negative answer means it's an adverse variance.
insightful
Many thanks Sazi
Mam can we write standard price instead of budgeting
Thank you for the enquiry. You can write standard price as well.
@@managementaccountingmadeea5236 thank you
A small doubt..
Why can't we use actual contribution instead of budgeted when calculating sales volume variance?
Hi, thank you for the query.
You always have to use the budgeted contribution per unit because the standards are set by the top management of the company so they would want to know (the variance) or how much they've gained or lost in their money value and not in the actual money value.
If you refer material usage variance or labour efficiency variance, we use the standard rate and not the actual rate for the same reason I've mentioned above.
So the rule is in standard costing when you convert any variance in money value you must use the standard rate.
I think I've mentioned this in one of my videos but sorry can't remember exactly on which one.
Hope this helps.
@@managementaccountingmadeea5236 thank you so much😍💓