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ACME Incorporated has the following standard unit costs for a single product Direct material 12.0 Kg @ $1.65 per kg $19.80 Direct labour 4 hours

ACME Incorporated has the following standard unit costs for a single product

Direct material 12.0 Kg @ $1.65 per kg

$19.80

Direct labour 4 hours @ $21.50 per hour

$86.00

Variable manufacturing overhead 4 hours @ $16 per hour

$48.00

Actual data for the month is as follows:

Direct materials purchased 19,600 Kg @ $1.75 per Kg

$34,300

Direct labour incurred 5,500 hours @ $22.70 per hour

$124,850

Variable manufacturing overhead incurred

$86,240

During the current month, 1,400 units were produced using 16,450 kg of material

Variable manufacturing overhead is applied based on direct labour hours.

Required:

Calculate the material, labour and variable manufacturing overhead variances for the month. (16 marks)

Show calculations and label variances (name of variance and favourable or unfavourable

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