2 The budget for department X of XYZ Manufacturing Company is as follows :

Engineering studies have shown that the standard times for producing one unit of A and 8 are as follows :
Product A 4 hours Product 8 2 hours At the end of the period you discover that the actual results were as follows :
Product A produced 2000 units Product 8 produced 4500 units The total direct labour hours worked were 19 000 hours and the costs incurred were Direct labour = £39 000 Variable overheads = £24 000 You are required to prepare a flexible budget and analyse the variances between price and quantity

Transcribed Image Text:

Product Activity Expenditure (units) () AB A 2500 Direct labour = 40 000 B 5000 Variable overheads = 20000 60 000