Variance Analysis Template Strictly Confidential

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This Excel model is for educational purposes only and should not be used for any other reason.
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Variance Analysis Example

Standard Production Cost (per gadget) Quantity Unit Cost

Direct Materials (pieces) 6 $0.50
Direct Labor (hrs) 1.3 $8
Variable Manufacturing Overhead (hrs) 1.3 $4
Fixed Manufacturing Overhead (hrs) 1.3 $6

Actual Gadget Production 3,000

Fixed Overhead Expense Budget $24,180

Actual Costs Quantity Cost

Direct Materials (pieces) 25,000 $0.48 (per piece)
Direct Labor (hrs) 4,000 $36,000
Variable Manufacturing Overhead (hrs) $17,000
Fixed Manufacturing Overhead (hrs) $25,000

Materials Variance
Actual Quantity 25,000
Actual Price $0.48
Standard Quantity Allowed 18,000
Standard Price $0.50

Price Variance $500 Favorable

Quantity Variance -$3,500 Unfavorable
Overall Materials Variance -$3,000 Unfavorable
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Labor Variance
Actual Hours 4,000
Actual Rate $9
Standard Hours Allowed 3,900
Standard Rate $8

Rate Variance -$4,000 Unfavorable

Efficiency Variance -$800 Unfavorable
Overall Labor Variance -$4,800 Unfavorable
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