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Question 4 (a) Borealis Electronics has the following standards and flexible budget data: Standard variable overhead rate RM6.00 per direct labour hour Standard quantity of direct labour 2 hours per unit of output Budgeted fixed overhead (based on 25,000 RM100,000 unite) Budgeted output 25,000 unite Standard cost per unit. Variable overhead RM12.00 Fixed overhead RM4.00 RM16.00 Actual results for October are given below Actual output 30,000 unite Actual variable overhead RM360,000 Actual fixed overhead RM106,000 Actual direct labour 56,000 DLH Required: Calculate the following variances and indicate whether each is favourable or unfavourable: i. Variable overhead spending, efficiency and total variance. (6 marks) ii. Fixed overhead budget, volume and total variance. (6 marks) (b) One of the stated advantages of standard costing is 'more stable product costs'. Required: i. Evaluate TWO (2) other advantages of standard costing. Provide relevant example(s) to support your answer. (6 marks) ii. Agsume that the firm's business activity has a strong seasonal pattern; namely, the volume of activity in the busiest month of the year is four times as large as the volume in the slowest month. Reflect how standard costing gives more stable product costs in this situation. You may assume that, on average, fixed costs of production amount to more than half of the cost of the product. (7 marks) (Total 25 marks)