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In: Accounting

(1)        The standard costs of wooden ducks on wheels, for the CURRENT year, for 5 mm...

(1)        The standard costs of wooden ducks on wheels, for the CURRENT year, for 5 mm board and for cutting are as follows:-

            5 mm board: 0.2 sq. metre at £4.50 per sq. metre.

            Cutters: 1.5 minutes at £7.20 per hour.

In the most recent period, 120 wooden ducks on wheels were produced.

25 sq. metres of 5 mm board were requisitioned from stores at a total cost of £110.

            2.75 hours were recorded for cutters at a total cost of £22.

            Required

(a)        Calculate the material price variance and material usage variance for 5 mm board

(ii)        Calculate the wage rate variance and labour efficiency variance for cutters

           

Suggest possible reasons for the variances calculated.

(2)        Given standard cost per unit:

            Direct materials (4 kg. @ 75p per kg)

            Direct labour (2 hrs @ £1.60 per hr)

            Actual details are:

           

£

Output produced (units)

          38,000

           

Direct material purchased

        180,000 kg

            126,000

           issued to production

        154,000 kg

Direct labour

          78,000 hrs

            136,500

            Calculate:        Material and labour variances.

Solutions

Expert Solution

Answer: (Question 1-a)

Answer to Question 1-(ii):

ekkarill92 answered 1 year ago
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