For a product the following data are given:

(a) Calculate the following variances:
(0 Direct materials cost.
(it) Direct materials price, based on issues to production.
(Hi) Direct materials usage.
(iv) Direct wages cost.
(v) Direct wages rate.
(vi) Direct labour efficiency.

(b) State whether in each of the following cases, the comment given and suggested as the possible reason for the variance, is consistent or inconsistent with the variance you have calculated in your answer to

(a) above, supporting each of your conclusions with a brief explanatory comment.
Item in (a)
(ii) Direct materials price variance: the procurement manager has ignored the economic order quantity and, by obtaining bulk quantities, has purchased material at less than the standard price.
(Hi) Direct materials usage variance: material losses in production were less than had been allowed for in the standard, (v) Direct wages rate variance: the union negotiated wage increase was £0.15 per hour lower than expected.
(vi) Direct labour efficiency variance: the efficiency of labour was commendable.

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Standards per unit of product: Direct material 4 kilogrammes at 0.75 per kilogramme 2 hours at 1.60 per hour Direct labour Actual details for given financial period: Output produced in units 38,000 Direct materials: Purchased 180,000 kilogrammes for 126,000 Issued to production 154,000 kilogrammes Direct labour 78,000 hours worked for 136,500 There was no work-in-progress at the beginning or end of the period. You are required to: