Q. 1 (Marks 10)

The Irish division of EXTEL Ltd has taken over the production and sale of the productEXTEL-10. The product is made to order, so no stocks are normally carried. You have been provided with the following budget data for the first quarter:

Budgeted production10,000 units

Standard cost sheet EXCEL-10

Materials5 kg @ /5.0025.00

Direct Labour2 hours @ /8.0016.00

Variable Overhead2 hours @ /12.0024.00

Fixed Overhead2 hours @ /6.0012.00

The actual results for the first quarter were as follows:

Actual production9,500 units

Sales/ 874,000

Materials(45,000kg)229,500

Direct Labour(18,000 hours)142,200

Variable Overhead215,000

Fixed Overhead120,000

Required:

a.Direct material rate and price variance

b.Direct labour rate andefficiency variance

c.Variable overhead spending and efficiency variance

d.Factory overhead budget and volume variance.