Question 5: A Mechanical Design Company produces an innovative design of Batttery used for electric cars. The standard design of producing one(1) unit of Battery is provided in the bill of materials BOM which requires material mix shown in Table Q5a. The current monthly production of Battery is 2000 units per month with the actual material consumption shown in Table Q5b. Determine the following and justify why it is favorable or adverse. (6) Material usage variance; (i) Material price variance; (ii) Total material cost variance; Table Q5a Materials Usage (units) Total cost (OMR) V 17 W 3 38 50 38 Y 2 Table Q5b Total cost (OMR) 50,478 93,522 104,477 76.889 Materials Usage (units) 12,027 6,879 17,231 4,347 V Y

Question 5: A Mechanical Design Company produces an innovative design of Batttery used for electric cars. The standard design of producing one(1) unit of Battery is provided in the bill of materials BOM which requires material mix shown in Table Q5a. The current monthly production of Battery is 2000 units per month with the actual material consumption shown in Table Q5b. Determine the following and justify why it is favorable or adverse. (6) Material usage variance; (i) Material price variance; (ii) Total material cost variance; Table Q5a Materials Usage (units) Total cost (OMR) V 17 W 3 38 50 38 Y 2 Table Q5b Total cost (OMR) 50,478 93,522 104,477 76.889 Materials Usage (units) 12,027 6,879 17,231 4,347 V Y

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Description: Question 5:A Mechanical Design Company produces an innovative design of Batttery used for electric cars. The standard design of producing one(1) unit of Battery is provided in the bill of materialsBOM which requires material mix shown in Table Q5a.

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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