Rustco Ltd have developed a new paint to help prevent corrosion and are marketing it for use on the underside of vehicles. Rustco Ltd are an expanding company and have recently appointed a new production manager who is responsible for the production of the paint.

The standard ingredients for one litre of the corrosion paint is:

600ml Corrosion resistant solution @ 24/litre 14.40

300ml Linseed oil @ 10/litre 3.00

100ml Red paint @ 8.00/litre 0.80

Standard cost per litre: 18.20

The corrosion resistant solution helps to protect the metal from corrosion, whilst the linseed oil helps to provide a waterproof coating. The red paint is purely to add colour.

During December 2021, 1,280 litres of the new paint was produced which required 720 litres of corrosion resistant solution, costing 17,200; 450 litres of linseed oil costing 2,400 and 110 litres of red paint costing 2,100.

Question 1

Required:

You are to calculate the individual material mix variances and show the total material mix variance