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QUIZ TOPIC 10: STANDARD COSTING AND VARIANCE ANALYSIS


QUIZ AA025 ACCOUNTING 2
TOPIC 10: STANDARD COSTING AND VARIANCE ANALYSIS
 
Duniabola Sdn Bhd (DSB) manufactures sports products. Information related to the production of the product is as follows:
 

1.        Standard Costs:

Item

Rate

RM

Direct materials

15 meter @ RM10.00

150.00

Direct labour

8 hours @ RM14.00 per hours

112.00

Variable manufacturing overhead

8 hours @ RM10.00 per hours

80.00

Fixed manufacturing overhed

8 hours @ RM8.00 per hours

64.00

Standard cost

 

406.00

 
2.         Estimated activity is 20,000 hours were based on direct labor hours.
 
3.     Actual data of costs and activities that have been involved January 2015.

Purchase of direct materials

40,000 meter @ RM10.60 per meter

Direct material used (meter)

37,000 meter

Direct labour

21,000 hours @ RM13.40 per hours

Variable manufacturing overhead

RM228,000

Fixed manufacturing overhead

RM180,000

Production unit

2,500

 
Required:
Calculate:                                                                                                         

(i)     Direct materials price variance and quantity/usage variance.

      (24,000 (UF), 5,000 (F))

(ii)    Direct Labour rate variance and labour efficiency variance.

(12,600 (F), 14,000 (UF))


(iii)   Variable overhead expenditure variance and variable overhead efficiency variance.
      (18,000 (UF), 10,000(UF))

(iv)  Fixed overhead budget variance and fixed overhead volume variance.

      (20,000 (UF), 0)          


ANSWER
(i)

(ii)

(iii)

(iv)




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