What is ‘Yield Variance’
Yield variance is the difference between actual output and standard output of a production or manufacturing process, based on standard inputs of materials and labor. The yield variance is valued at standard cost. Yield variance is generally unfavorable, i.e., actual output is less than standard or expected output, and only rarely favorable.
Explaining ‘Yield Variance’
For example, if 1,000 units of a product is the standard output based on 1,000 kilograms of materials in an 8-hour production unit, and the actual output is 990 units, there is an unfavorable yield variance of 10 units. If the standard cost is $25 per unit, the unfavorable yield variance would be $250.
Further Reading
- On the theory of financial intermediation – www.jstor.org [PDF]
- Economic determinants of the nominal treasury yield curve – www.sciencedirect.com [PDF]
- A causality-in-variance test and its application to financial market prices – www.sciencedirect.com [PDF]
- Modeling bond yields in finance and macroeconomics – pubs.aeaweb.org [PDF]
- Measuring European financial integration – academic.oup.com [PDF]
- International bond risk premia – www.sciencedirect.com [PDF]
- No-arbitrage macroeconomic determinants of the yield curve – www.sciencedirect.com [PDF]
- Bond ratings, bond yields and financial information – onlinelibrary.wiley.com [PDF]
- The macroeconomy and the yield curve: a dynamic latent factor approach – www.sciencedirect.com [PDF]
