Q7)

The following data was taken from the most recent quarterly sales forecast.

Expected Sales Units

Target Inventory End of Month Units

August

1422

288

September

1675

386

October

1657

423

How many units should the company produce in September?

Q8)

The standard cost sheet is as follows:

Direct material

2kg

$2.50/kg

$5.00

Direct labour

1 hour

$20/hour

$100

The Actual data is as follows: 11,674 units were produced

Direct material purchased

25,000kg

$2/kg

$50,000

Direct material used

22,000kgs

Direct labour

12,000 hours

$21/hour

$252,000

Calculate the labour efficiency variance.

****Enter a negative number if you have a Favourable variance and a positive number if you have an Unfavourable variance.****

Q9)

The standard cost sheet is as follows:

Direct material

2kg

$2.50/kg

$5.00

Direct labour

5hours

$20/hour

$100

The Actual data is as follows: 10,905 units were produced

Direct material purchased

25,000kg

$2/kg

$50,000

Direct material used

22,000kgs

What is the direct material quantity variance?

****Enter a negative number if you have a Favourable variance and a positive number if you have an Unfavourable variance.****

Q10)

Given the following information, calculate the direct labour rate variance.

Actual direct labour hours

34 500

Standard direct labour hours

35 000

Actual direct labour rate

$6.27

Direct labour efficiency variance (F)

$3 200

****Enter a negative number if you have a Favourable variance and a positive number if you have an Unfavourable variance.****

Q12)

Melbourne Cabinet set the following standard cost per unit for 2020:

Fixed overhead (2 machine hours at $10)

$20

Variable overhead (2 machine hours at $8)

$16

The standards were set based on a capacity of 20 000 machine hours. During the year, 6160 units were produced.

Fixed overhead

$206,546

Variable overhead

$155,550

What was the fixed overhead budget variance?

****Enter a negative number if you have a Favourable variance and a positive number if you have an Unfavourable variance.****

Q13)

Southern Manufacturing set the following standard cost per unit for 2020:

Units

15,000

Variable overhead rate

$18 per labour hour

Fixed overhead

$190,000

Direct labour

1.5 hours per unit

What is the variable overhead spending variance given the following actual information?

Number of products

16,000

Variable overhead

$ 476,153

Direct labour

30,000 hours

****Enter a negative number if you have a Favourable variance and a positive number if you have an Unfavourable variance.****

Q14)

If the actual fixed overhead cost is 200,803, what is the fixed overhead budget variance for Southern Manufacturing in the above question?

****Enter a negative number if you have a Favourable variance and a positive number if you have an Unfavourable variance.****

Q15)

A manufacturer is considering whether to make or buy a component used in its production. The annual cost of producing the 10,000 parts is as follows.

Direct variable manufacturing costs $ 300,000

Direct fixed manufacturing costs $ 100,000

Allocated overhead $ 50,000

If the manufacture buys the component, the direct fixed manufacturing costs can be reduced by 73 per cent. What is the maximum unit purchasing price that makes purchasing a beneficial decision in comparison to making?

Q17)

Mel Ltd manufacturers a number of specialised electronic components, including B2Sensors. Mel Ltd has the capacity to produce 10,000 units of B2 per year. Currently it is operating at 80 per cent capacity. The selling price for B2 is $100 per unit. The variable cost per unit is $26. Fixed cost allocated to producing B2 is $100,000 per year. Mel Ltd receives a special order for 3,000 units of B2. The opportunity cost associated with taking this special order is:

Q20)

A firm makes three products, Alpha, Beta and Gamma.

Alpha

Beta

Gamma

Sales price per unit

$7.00

$10.00

$13.00

Variable cost per unit

$4.00

$2.00

$10.00

Demand

5,000

4,000

1,000

Machine hours used

0.5

2

1

The total available machine hours is 11,467.

How many of Gamma should be in the product mix to maximize the profit?