Question
the product launch, which was five years ago. It has not changed since. Last month 4,600 kg of Omega were produced, using the following inputs:
the product launch, which was five years ago. It has not changed since. Last month 4,600 kg of Omega were produced, using the following inputs: Input Alpha Beta Gamma Total (kg) 2,200 2,500 291920 5,620 Cost per kg (R) 1.80 6.00 1.00 Cost per 100 kg of Omega (R) 3,960 15,000 920 19,880 At the end of each month, the production manager receives a standard cost operating statement from contains material price and usage variances, labour Kappa Ltd's performance manager. The statement rate and efficiency variances, and overhead expenditure and efficiency variances for the previous month. No commentary on the variances is given and the production manager receives no other feedback on the efficiency of the Omega process. Required: eggs (a) Calculate the following variances for the last DA month: wore tota (i) the material usage variance for each ingredient and in total 613 rosa (4 marks) (4 marks) hde (ii) (3 marks) the total material mix variance (iii) the total material yield variance. (b) Discuss the problems with the current system of calculating and reporting variances for assessing the performance of the production manager. noge 101 2002691 aldiazoq taeggua bluor of viewil redactor Adapted from ACCA Performance Management (9 marks) 2206 TEY Act Cl Au Av To R
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