ZuoTi.Pro
Question

QUESTION 2 You are the owner of Boekenhout (BH), a business in Cape Town that produces clay fireplaces for the international market. During January BH produced 7,800 units, and the accounting records indicated the following Direct material purchased Direct labour Direct material used 25,000 kg 40,100 hours 23,100 kg R 5,20 per kg R 34 per hour 10 12 13 The fireplaces have the following standard prime costs Total Direct material Direct labour Total Required For the month of January calculate the following variances, indicating whether each is favourable or R5 per kg 15 16 17 18 19 20 3 kg R15 R180 R195 5 hours R 36 per hour unvafourable 24 25 26 Direct Material Price Variance Direct Material Quantity Variance Direct Labour Rate Variance Direct Labour Efficiency Variance Discuss the materials and labour variances that you calculated by providing typical scenariOS 28 29 30 32

business   accounting   
0 0
Add a comment Improve this question Transcribed image text
Next > < Previous
Sort answers by oldest

Homework Answers

Answer #1

Total Units In January 7800 Units Direct Material Price variance Actual Qty(Standard Price- Actual Price) 23100(5-5.2) =4520 (unfavourable) Here Actual Qty is what we consumed i..e 23,100 kg Direct material Qty variance Std Price(Std Qty- actaul Qty) 5.00(23400-23100) 1500 (favourable) Calculation of Std Qty: For producing One unit, raw materials 3kg is required then for Producing 7800 Units how much raw material is required? One Unit- 3kg 7800 units-? 23400kgLabour rate Variance- actual Hours(Std rate- actual rate) 40100(36-34) 80200 favourable Labour Efficency variance- Std rate( Std Hours- Actual Hours) - 36(39000-40100) - -39600 (Unfavourable) Calculation of Std Hrs: For producing One unit, time required is 5 hours then for Producing 7800 Units how much raw material is required? One Unit-5 hrs 7800 units-? = 7800*5 39000 39000 hrs1.Variances calculated should be write off to Profit and Loss account or Cost of Sales of that particular month 2.Distribution is done on Pro rata basis among Cost of Sales,Finished goods & Work in Progress

0 0
Add a comment
Know the answer?
Add Answer to:
QUESTION 2 You are the owner of Boekenhout (BH), a business in Cape Town that produces...
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for? Ask your own homework help question. Our experts will answer your question WITHIN MINUTES for Free.
Similar Homework Help Questions

  • ABC Manufacturing Company's costing system has two direct cost categories: direct materials and direct manufacturing labour....

    ABC Manufacturing Company's costing system has two direct cost categories: direct materials and direct manufacturing labour. Manufacturing overhead (both variable and fixed) is allocated to products on the basis of standard DMLH At the beginning of 2018, ABC adopted the following standards for its manufacturing costs: Input Cost per Output Unit S 15 75 3 kg at $5 per kg 5 hours at $15 per hour Direct materials Direct manufacturing labour Manufacturing overhead: Variable Fixed Standard manufacturing cost per output...

  • Muddy Duck Manufacturing (MDM) Inc.’s costing system has two direct cost categories: direct materials and direct...

    Muddy Duck Manufacturing (MDM) Inc.’s costing system has two direct cost categories: direct materials and direct manufacturing labour. Manufacturing overhead, both fixed and variable, is allocated to products on the basis of standard direct manufacturing labour hours (DMLH). At the beginning of 2017, MDM adopted the following standards for its manufacturing costs: Input Cost per output unit Direct materials 3kg @ $5 per kg $15 Direct manufacturing labour 5 hours @ $15 per hour 75 Manufacturing overhead: Variable $6 per...

  • $ 7.50 37.50 Cost standards for one unit of product no. 077: Direct material 3 pounds...

    $ 7.50 37.50 Cost standards for one unit of product no. 077: Direct material 3 pounds at $2.50 per pound Direct labor 5 hours at $7.50 per hour Actual results: Units produced 7,800 units Direct material purchased 26,000 pounds at $2.70 Direct material used 23,100 pounds at $2.70 Direct labor 40,100 hours at $7.30 $ 70,200 62,370 292,730 Assume that the company computes variances at the earliest point in time. The direct-labor rate variance is: Multiple Choice 0 $7,800F. 0...

  • The following data relate to product no. 33 of Volusia Corporation: 10 Direct labor standard: 5...

    The following data relate to product no. 33 of Volusia Corporation: 10 Direct labor standard: 5 hours at $14 per hour Direct labor used in production: 45,000 hours at a cost of $639,000 Manufacturing activity: 8,900 units completed The direct-labor rate variance is: Multiple Choice Ο $8,900F. Ο $8,90ου. Ο $9,00OF. Ο $9,000U. Ο None of the answers is correct. 12 $ 7.50 37.50 Cost standards for one unit of product no. 077: Direct material 3 pounds at $2.50 per...

  • Waterways Continuing Problem 12 At the end of June the manager of the B.C. manufacturing plant...

    Waterways Continuing Problem 12 At the end of June the manager of the B.C. manufacturing plant was provided with the following variance analysis report: Budget Actual Variance Favourable (F)/ Unfavourable (U) Production in units 332,000 347,000 15,000 F Production costs:    Direct material $996,000 $1,017,940 $(21,940) U    Direct labour 1,411,000 1,442,700 (31,700) U    Variable overhead costs 166,000 172,957 (6,957) U    Fixed overhead costs 174,300 168,620 5,680 F Total production costs $2,747,300 $2,802,217 $(54,917) U The manager immediately called the production supervisor,...

  • At the beginning of 19X4, Beal Company adopted the following standards: Direct material (3 pounds &$2.50...

    At the beginning of 19X4, Beal Company adopted the following standards: Direct material (3 pounds &$2.50 per pound) 750 3750 Direct labor (5 hours $7.50 per hour) Factory overhead: Variable ($3.00 per dircet labor hour) Fixed ($4.00 per direct labor hour) 15.00 20.00 Standard cost per unit Normal volume per month is 40,000 direct labor hours Beal's January 19X4 budget was based on normal volume. During January. Beal produced 7,800 units with records indicating the following: Direct material purchased Direct...

  • QUESTION 1 (3C 1.1 INFORMATION: Britelite Manufacturers produces a product which has the following standard costs:...

    QUESTION 1 (3C 1.1 INFORMATION: Britelite Manufacturers produces a product which has the following standard costs: Material A: 3 kilograms at R20 per kilogram Material B:5 kilograms at R15 per kilogram Direct labour: 8 hours at R10 per hour Fixed overheads: R120 000 Budgeted production: 9000 units Actual results for February 2019 were as follows: Material A: 32 500 kg at R22 per kilogram Material B: 54 000 kg at R14 per kilogram Direct labour: 88 000 hours at R12...

  • Question 27 At the end of June, the manager of the B.C. manufacturing plant was provided...

    Question 27 At the end of June, the manager of the B.C. manufacturing plant was provided with the following variance analysis report. Favourable (F)/ Unfavourable (U) Budget 310,000 Actual 323,000 Variance 13,000 п Production in units Production costs: Direct material Direct labour Variable overhead costs Fixed overhead costs Total production costs $742,109 1,395,000 131,750 147,250 $2,416,109 $749,581 1,420,440 135,821 139,870 $2,445,712 $(7,472) (25,440) (4,071) 7,380 $(29,603) псс с The manager immediately called the production supervisor, demanding an explanation for the...

  • Question 7 (12 marks) Bright Electric Company Limited manufactures electric table lamps The standard cost specification...

    Question 7 (12 marks) Bright Electric Company Limited manufactures electric table lamps The standard cost specification sheet of the company shows the following information related to its standard costs that have been set for its new model called Slim Line Elegance as: $14.00 $12.00 Direct materials (1 kg) Direct labour (2 hours) Overhead: Fixed - $1.10 per direct labour hour Variable - $1.30 per direct labour hour $2.20 $ 30.80 Actual production and cost information for December 2018 is as...

  • Question: Waterways Continuing Problem 12 At the end of June the manager of the B.C. manufacturing...

    Question: Waterways Continuing Problem 12 At the end of June the manager of the B.C. manufacturing plant was provided with the following variance analysis report: Favourable (F)/ Unfavourable (U) Budget Actual Variance Production in units 310,000 323,000 13,000 Production costs: Direct material $(11,781) (25,440) (4,538) $737,800 $749,581 U Direct labour Variable overhead costs Fixed overhead costs 1,395,000 131,750 147,250 1,420,440 U 136,288 U 139,870 7,380 F Total production costs $(34,379) $2,411,800 $2,446,179 U The manager immediately called the production supervisor,...

ADVERTISEMENT
Free Homework Help App
Download From Google Play
Scan Your Homework
to Get Instant Free Answers
Need Online Homework Help?
Ask a Question
Get Answers For Free
Most questions answered within 3 hours.
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT