QUESTION 2 Dasebre Ltd produces and sells one product with the brand name Sobolo. The standard cost for one unit being as follows: GHS 200 30 Direct material A-10 kilograms at GHS20 per kg Direct material B-5 litres at GHS6 per litre Direct wages - 5 hours at GHS6 per hour Variable production overhead Total standard cost 30 50 310 The variable production Overheads is incurred in direct proportion to the direct labour hours worked. The budgeted sales volume for the month of May was 900 units at Standard price of GHS350 Actual results for the month of May are as follows: Production and Sales 800 units Material A 7,800 kg used, costing GHS 159,900 Material B 4,300 litres used, costing GHS 23,650 Direct wages 4,200 hours worked for GHS 24,150 Variable production overhead GHS 46,200 Sales proceeds GHS320,000 The Managing Director of Dasebre Ltd does not understand why there are differences between the standard and the actual costs and has tasked you as a Management consultant to undertake a variance analysis to investigate the differences recorded for the year under review. Note: Computations are required to support your analysis Required: Write a report to the Managing Director, highlighting all the possible variances in Material, Labour, Variable Overheads and Sales and their possible causes. (18 marks) 2