problem- 4 (material & labour) the following details relating to the product ‘x’ during the...
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![Page 1: Problem- 4 (Material & Labour) The following details relating to the product ‘X’ during the month March, 2011 are available. You are required to compute:](https://reader035.vdocuments.net/reader035/viewer/2022072007/56649d355503460f94a0d43f/html5/thumbnails/1.jpg)
Problem- 4(Material & Labour)
The following details relating to the product ‘X’ during the month March, 2011 are available. You are required to compute: i. Material Price Variance. ii.Material Usage Variance. iii.Material Cost Variance iv.Labour Rate Variance. v.Labour Efficiency Variance. vi.Labour Cost Variance.
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Contd…
You are also required to reconcile the standard and actual cost with help of such variances. Standard Cost per unit: Material 50 Kg. @ ` 40 per kg.Labour 400 hrs. @ ` 1.00 per kg.
Actual Cost for the month: Material 4,900 Kg. @ ` 42 per kg.Labour 39,600 hrs. @ ` 1.10 per kg.Actual production – 100 units
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Problem -5 (Labour & Variable Overhead)
The following information has been extracted from the books of Goru Enterprises which is using standard costing system:
Actual output 9,000 units Direct wages paid 1,10,000 hours at ` 22 per hour, of
which 5,000 hours, being idle time, were not recorded in production
Standard hours 10 hours per unitLabour efficiency variance ` 3,75,000 (A)Standard variable overhead ` 150 per unitActual variable overhead ` 16,00,000
You are required to calculate: (i) Idle time variance; (ii) Variable overhead expenditure variance; (iii) Total variable overhead variance and (iv) Variable overhead efficiency variance.
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Problem -6 (Fixed Overheads)
AKASH LTD. operates a system of Standard Costing. The company has normal monthly machine hour capacity of 100 machines working 8 hours per day for 25 working days in the month of April 2014.
i.The Standard time required to manufacture one unit of products is 4 hours. The Budgeted fixed overhead was 1,50,000.
ii.In the month of April 2014, the company actually worked for 24 days for average 750 machine – hours per day.
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Contd…
(iii)The Actual production was, 4,500 units, and the actual fixed overhead was 1,60,000.
You are required to compute: A. Fixed overhead efficiency variance B. Fixed overhead capacity variance C. Fixed overhead calendar variance D. Fixed overhead expenditure variance E. Fixed overhead volume variance F. Fixed overhead cost variance.
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Problem – 7 (Overheads)
The following budget was prepared for the overhead of Department X:
Budget for period
Fixed overhead ` 5,600Variable overhead ` 10,400Machine hours 1,600Standard hours of production 1,600
After the period the actual results were:
Total overhead ` 17,400
Machine hours 1,630Standard hours produced 1,590
You are required to calculate the overhead variances for the period.
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Contd…
At the end of the period, a price of ` 3.00 was agreed to
have been an efficient buying price in the period. The
standard costing system shows a direct material total
variance of ` 8,800 made up of:-
Material usage variance ` 2,000 (A)
Material Price Variance ` 16,800 (A)
Management wishes to distinguish between controllable
and uncontrollable effects on performance.