Question 4 Castillena Ltd, specializing in high quality handmade life style designer accessories, uses standard costing and flexible budget to help plan and control its operations and costs. Its current normal capacity on direct labour hours is 272,000 hours, same as previous year's. Each of the 100 workers is entitled to a total of 25 days annual and statutory holidays. Due to a recent flooding problem in the city, some accounting records have been damaged. You have been approached by a potential investor to ensure that the accounting figures presented to him will be genuine. So you are required to work out the required based on the following information: Product Budgeted production (based on normal direct labor capacity) Actual production. Actual sales 340,000 units 330,000 units 320,000 units 1.5 kg per unit 550,000 kg $2,860,000 $110,000 U 25,000 U Raw Materials Standard quantity of materials used in each product Actual direct materials purchased in kg Actual direct materials purchased Direct materials price variance Direct materials usage (quantity) variance Drect labor Standard hourly direct labor rate Actual Direct Labor Hour (DLH) - Variable Manufacturing Overhead Actual variable manufacturing overhead costs. Total variable manufacturing overhead variance Fixed Manufacturing Overhead Budgeted fixed manufacturing overhead Fixed manufacturing overhead pre-determined overhead rate Actual fixed manufacturing overhead $20 per hour 363,000 Hours $4,200,000 $1,560,000 U $3,400,000 $12.5 per direct labor hour $4,800,000 Required: a) What was the actual quantity (in kg) used in the production of the accessories? Please show your workings. 7/9 b) How much was the variable manufacturing overhead rate variance? c) How much was the fixed manufacturing over-/under-applied adjustment