(a)(b)The following details have been extracted from the standard cost card ofProduct X which is manufactured by the XYZ chemical company using anabsorption costing system:Direct materials (2kg at £4.20)Direct labour (1 hour)Variable overhead (1 hour)Fixed overhead (1 hour)(i)The fixed overhead charged to each unit of the product is based on amonthly production of 2,000 units.(ii)During October 20X3, the actual production amounted to 2,150 units andcosts incurred were as follows:Direct materials (4,330 kg)Direct labour (2,200 hours)£8.407.603.905.10Variable overhead (2,200hours)Fixed overhead (2,200 hours)25.00What was the material price variance?£18,10014,9808,1609,950What was the material usage variance?What was the direct labour rate variance?What was the direct labour efficiency variance?(iii)(iv)(v) What was the variable overhead rate variance?Explain the possible causes for the Material variances.

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(a) The following details have been extracted from the standard cost card of Product X which is manufactured by the XYZ chemical company using an absorption costing system: (i) Direct materials (2kg at £4.20) Direct labour (1 hour) Variable overhead (1 hour) Fixed overhead (1 hour) The fixed overhead charged to each unit of the product is based on a monthly production of 2,000 units. (ii) During October 20X3, the actual production amounted to 2,150 units an costs incurred were as follows: (iii) Direct materials (4,330 kg) Direct labour (2,200 hours) Variable overhead (2,200 hours) Fixed overhead (2,200 hours) £ 8.40 7.60 3.90 5.10 25.00 What was the material price variance? £ 18,100 14,980 8,160 9,950 What was the material usage variance? What was the direct labour rate variance?

(a) The following details have been extracted from the standard cost card of Product X which is manufactured by the XYZ chemical company using an absorption costing system: (i) Direct materials (2kg at £4.20) Direct labour (1 hour) Variable overhead (1 hour) Fixed overhead (1 hour) The fixed overhead charged to each unit of the product is based on a monthly production of 2,000 units. (ii) During October 20X3, the actual production amounted to 2,150 units an costs incurred were as follows: (iii) Direct materials (4,330 kg) Direct labour (2,200 hours) Variable overhead (2,200 hours) Fixed overhead (2,200 hours) £ 8.40 7.60 3.90 5.10 25.00 What was the material price variance? £ 18,100 14,980 8,160 9,950 What was the material usage variance? What was the direct labour rate variance?

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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