Data (n = 2,658) from live animal ultrasonic measures from 17 Angus herds were used to evaluate a multiplicative mixed model that incorporates scaling factors to correct for across-herd heterogeneity of variance. Traits included were ribeye muscle area (EMA), surface fat at the P8 site (P8), surface fat between the 12th and 13th ribs (RIB12), and weight at scanning (WEIGHT). Cattle ranged in age from 501 to 698 d and represented 291 contemporary groups. Data were initially analyzed using single-trait, animal model, Method R procedures to estimate variance components and heritabilities (h2). These estimates were incorporated into a multiplicative mixed model that simultaneously estimates breeding values (EBV) and heterogeneity factors. Re-estimation of h2 after scaling the data with the correction factors was explored to obtain a measure of the improvement in the genetic evaluation and to detect changes in ranking of individuals and herds. Initial h2 estimates for EMA, P8, RIB12, and WEIGHT were .36, .39, .29, and .48, respectively. Scaling factors ranged from .25 for P8 in a herd with eight records to 1.96 for RIB12 in a herd with 86 individuals. Re-estimates of h2 increased by an average of 4.2% for all the traits as a result of correcting for heterogeneity. Deviations of new scaling factors were within expectations. Correlations between EBV with and without heterogeneity correction were greater than .97 for all the traits. However, some substantial re-rankings of herds were observed for some traits in the smaller herds.