QUESTION 5 (20 Marks)

The following performance report summarizes budget and actual usage and costs for the items shown for a particular month in which 100 SeaCruiser hulls were produced by Cruiser Inc.

Raw materials: Budget Actual Variance Glass fiber clotT 45 780 46125 345 U Budget Standard/hull of 218 meters @$2.10/m x 100 hulls Actual: 22 500 m @2.05/m

Direct labour: Budget Actual Variance Build up labour: 33280 32 893 387 F Budget Standard/hull of 26 hrs @$12.80/hr x 100 hulls Actual: 2 540/hrs @12.95/hr

Variable overhead: Budget Actual Variance

8320 8128 192 F Related to build up labour Budget: Standard/hull of 26hrs @$3.20/hr x 100 hulls Actual: 2 540hrs @ $3.20/Hr

Total 87 380 87146 234 F

Required

Analyse the budget variance for each item by calculating the quantity and cost per unit of input variances.