Standard Costing

A company produces a product which has a standard variable production cost of $$8$ per unit

made up as follows:

$ per unit

Direct material $$4\mathrm{.}60(2$kg X $$2\mathrm{.}30$ per kg$)$

Direct labour $$2\mathrm{.}10(0\mathrm{.}7$ hours X $$3\mathrm{.}00$ per our$)$

Variable overhead $$1\mathrm{.}30$

Fixed manufacturing costs are treated as period costs. The following information is available

for the period just ended.

Variable manufacturing cost of sales $($at standard cost$)$ $$263,520$

Opening stock of finished goods $($at standard cost$)$ $$120,800$

Closing stock of finished goods $($at standard cost$)$ $$146,080$

Direct material price variance $$2,571$ unfavourable

Raw materials used in manufacture $($at actual cost$)$ $$170,310$

Direct labour rate variance $$4,760$ unfavourable

Direct labour efficiency variance $$3,240$ favourable

Required:

$($a$)$ Determine for the period just ended

$($i$)$ the number of units produced

$($ii$)$ the raw material usage variance

$($iii$)$ the total actual direct labour cost, and

$($iv$)$ the actual cost per kg of raw material used

B $)$ Outline the possible causes of the raw material variances