Homework Answers
Standard Material for 10,000 units Actual for 10,000 unita
Material Std. Qty Std. Price Total Std. Cost Actual Qty Actual Price Total Actual Cost
A 30000(3*10000) R20 R600000(30000*R20) 32500 R22 R715000(32500*R22)
B 50000(5*10000) R15 R750000(50000*R15) 54000 R14 R756000(54000*R14)
Total 80000 R1350000 86500 R1471000
1.1.1 Material Mix Variance= Standard Price(Std. Mix- Actual Qty)
Material A = R20[(86500*30000/80000)-32500]= R20(32437.5-32500)= R1250 (Adverse)
Material B = R15[(86500*50000/80000)-54000] = R15(54062.5-54000)= R937.5 Favourable
Total = R312.5 (Adverse)
1.1.2. Material Yield Variance = Std. Price(Std. Qty- Std. Mix)
Material A = R20[30000- (86500*30000/80000)]= R20(30000-32437.5)= R2437.5 (Adverse)
Material B = R15[50000- (86500*50000/80000)] = R15(50000-54062.5)= R4062.5 (Adverse)
Total = R6500(Adverse)
Fixed Overhead Rate per hour= Budgeted Overhead/ Budgeted Hours
= R120000/(9000*8 hrs)= R1.67 per hour
1.1.3. Fixed Manufacturing Overheads Volume Capacity Variance= Std. Rate per hour(Actual Hrs- Budgeted Hrs)
= R1.67(88000- 9000*8)= R1.67(88000-72000)= R26720 Favourable
1.1.4. Fixed Manufacturing Overheads Volume Capacity Variance= Std. Rate per hour(Std. hours-Actual hrs)
= R1.67( 10000*8-88000) = R1.67(80000-88000) = R13360 (Adverse)
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