Budgeting is the basis for all business success. Do you agree? Justify your answer. 10 marks b. Characterize Divisional performance measures. State the three principal measures to measure divisional performance. 5 marks c. Peacock Company produces quality maize meal in packets and sells to retailers. Company purchases the raw materials from the farmers directly. Since the commencement of business Peacock uses standard costing to manage the costs. The standard cost card shows the following costs to produce one packet of maize meal. Materials required 1.5 kg at 12 per kg 18 Labour required 0.6 hours at 24 per hour 14.40 Manufacturing overheads(variable) 0.6 hours at 5 3 During April 2021, the production and sales were3,000 packets of maizemeal.the material purchase was 8000kg at the rate of 11.50 per kilogram, but only 6,000kg were used in the month of April. There was no opening stock of material in 1st of April. Labour hours used in April were 1600 hrs and the total labour cost was 40,000.The manufacturing overheads (variable) recorded for April was 7,200. You are required to calculate: i. Material price variance ii. Material Usage variance iii. Material cost Variance iv. Labour Rate variance v. Labour efficiency variance vi. Labour cost variance vii. Variable overhead expenditure variance viii. Variable overhead efficiency variance ix. Variable overhead variance.

Management Accounting