QUESTION b

The following are standard data relating to Mohamad Ali Bhd. which makes boxing gloves:

	Allowance	RM per glove
Material : Frazier Norton Foreman Labour cost at RM9 per hour	4kg 0.5kg 2	6 2.4 1.2 7.2

Last month the company produced 9,000 gloves. During the month the following materials were in stock, were purchased and were issued.

Opening stock: Frazier 6,000 kg, Norton 800 kg, Foreman 400 kg

Purchases: Frazier 40,000 kg at RM1.40 per kg

Norton 2,400 kg at RM4.60 per kg

2,400 kg at RM5 per kg

Foreman 800 kg at RM0.80 per kg

20,000 kg at RM0.60 per kg

Issues: Frazier 39,200 kg, Norton 4,200 kg, Foreman 18,080 kg.

The company calculates material price variance on purchases. Last month the total hours worked by the workers amounted to 8,200 hours and they earned a total gross wage of RM71,280. There is no opening or closing work in progress.

a) You are required to calculate for the last month:

(i) materials price variance;

(ii) materials usage variance;

(iii) labour rate variance, and

(iv) labour efficiency variance.