(1) The standard costs ofwooden ducks on wheels, for the CURRENT year, for5 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 woodenducks on wheels were produced.
25 sq. metres of 5 mm board wererequisitioned from stores at a total cost of £110.
2.75 hours were recorded for cutters at a total cost of £22.
Required
(a) Calculate thematerial price variance and material usage variance for 5 mmboard
(ii) Calculate the wagerate variance and labour efficiency variance for cutters
Suggest possible reasons for thevariances calculated.
(2) Given standardcost 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 | 78,000hrs | 136,500 |
Calculate: Material andlabour variances.
