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Makola Steel factory ( Pty ) Ltd manufactures special steel pipes used in mines and uses a standard costing system: Standard cost per steel pipe

Makola Steel factory (Pty) Ltd manufactures special steel pipes used in mines and uses
a standard costing system:
Standard cost per steel pipe R
Direct material 1100 kg \times R50 per kg 55000
Direct labour
1500 hours \times R105
per hour 157500
Variable production overheads (varying with
hours worked)
1500 hours \times R30 per
hour 45000
Variable selling costs 30000
Budgeted selling price per steel pipe (unit)450000
During March 100 units (steel pipes) were manufactured and sold.
Actual results per steel pipe Total (R)
Cost of direct material 1050 kg \times R55 per kg 5775000
Cost of direct labour
1510 hours \times R100 per
hour 15100000
Variable production
overheads
4681000
Variable selling costs 3005000
Sales revenue 46000000
REQUIRED Marks
For the month of March:
(a) Calculate the direct material purchase price variance. (3)
(b) Calculate the direct material quantity variance. (3)
(c) Calculate the direct labour rate variance. (3)
(d) Calculate the direct labour efficiency variance. (3)
(e) Calculate the variable production overhead rate variance. (3)
(f) Calculate the variable production overhead efficiency variance. (3)
(g) Calculate the selling price variance. (3)
(h) Calculate the variable selling costs spending variance. (

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