STANDARD COSTING VARIANCE QUESTION – 1 Zincet Co, a manufacturing firm, operates a standard costing system. It makes a single product, ZIN, using a single raw material CET. Standard costs relating to ZIN have been calculated as follows. Standard cost schedule – ZIN Per unit (RM) Direct material, CET, 50 kg at RM15 per kg 750 Direct labour, 8 hours at RM10 per hour 80 Variable overhead, 8 hours at RM4 per hour 32 Total standard costs 862 The standard selling price of a ZIN is RM1,000 and Zincet Co produces 2,000 units a month. During October 2021, 1,800 units of ZIN were produced. Relevant details of this production are as follows: Direct material CET – 88,000 kg costing RM1,232,000 were bought and used. Direct labour – 14,000 hours were worked during the month and total wages were RM133,000. Variable production overhead – The actual cost of the month was RM70,000. Inventories of the direct material CET are valued at the standard price of RM15 per kg. Each ZIN was sold for RM1,075. Required: Calculate the following for the month of October 2021. (d) Selling price variance. (e) Sales volume contribution variance. (f) Variable production cost variance.

STANDARD COSTING VARIANCE QUESTION – 1 Zincet Co, a manufacturing firm, operates a standard costing system. It makes a single product, ZIN, using a single raw material CET. Standard costs relating to ZIN have been calculated as follows. Standard cost schedule – ZIN Per unit (RM) Direct material, CET, 50 kg at RM15 per kg 750 Direct labour, 8 hours at RM10 per hour 80 Variable overhead, 8 hours at RM4 per hour 32 Total standard costs 862 The standard selling price of a ZIN is RM1,000 and Zincet Co produces 2,000 units a month. During October 2021, 1,800 units of ZIN were produced. Relevant details of this production are as follows: Direct material CET – 88,000 kg costing RM1,232,000 were bought and used. Direct labour – 14,000 hours were worked during the month and total wages were RM133,000. Variable production overhead – The actual cost of the month was RM70,000. Inventories of the direct material CET are valued at the standard price of RM15 per kg. Each ZIN was sold for RM1,075. Required: Calculate the following for the month of October 2021. (d) Selling price variance. (e) Sales volume contribution variance. (f) Variable production cost 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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