Question
QUESTION 2 Answer the questions from the information provided. Use the information provided below to calculate and comment on the following variances Variable overheads efficiency
QUESTION 2
Answer the questions from the information provided.
Use the information provided below to calculate and comment on the following variances
- Variable overheads efficiency variance (3 marks)
- Variable overheads expenditure variance (3 marks)
INFORMATION
The standard costing system is in operation at Project Max. The standards and actual information for April 2021 for the only product that is manufactured are as follows:
| Standards | |
| Direct materials | 5 metres @ R10 per metre |
| Direct labour | 4 hours @ R60 per hour |
| Variable overheads | R15 per labour hour |
| Normal production | 10 000 units per month |
| Actual information for April 2021: | |
| Direct materials used | 44 000 metres @ R8.80 per metre |
| Direct labour | 37 000 hours @ R58 per hour |
| Variable overheads | R576 000 |
| Production | 9 000 units manufactured |
FORMAT:
1
| Variable overheads efficiency variance |
| = |
| = |
| = |
| Comment: |
(3 marks)
2
| Variable overheads expenditure variance |
| = |
| = |
| = |
| = |
| Comment: |
(3 marks)
PLEASE ANSWER IN FULL USING THE TABLES ABOVE.
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started
Fundamentals of Financial Accounting
Authors: Fred Phillips, Robert Libby, Patricia Libby, Brandy Mackintosh
4th Canadian edition
978-1259269868, 978-1259103292
