Work order variances on process manufacturing work orders with a product and multiple co-products

Summary:

We are getting Yield, Usage and Efficiency variances on work orders that have one primary product and multiple co-products. Our work method is process manufacturing. The variances can be large depending on the difference between the work order quantity and the quantity of the primary product that is produced.

The work order costs are spread across the product and co-products using cost allocation percentages based on a weighted average calculation.

It appears that the variances are in addition to the normal yield, usage, and efficiency variance calculation. The calculation seems to be based on a calculated ratio using the formula (WO Quantity / Primary Product Quantity).