a Standart Costing i —-A-company\s “pred cing, Rvished product Ka Tree Raw Material ~—axe.used Yor producing. Pinished “predict. Rewmatetial A, Rava material By cand Rawmatevial C2 22 : c : en According. bo Strrelords,...5 6g oF ra material A, & Kg of Raw material B amd A Kg_of aw matevial C _ 1s ~~ Seqiscect Pox. -prodicing..@ twits od Riviched Product K. Standart Price oF cas Material Ais Ws 4. per kg. Stanclarrt Price of Vaumecterial B.S Rs la Ree kg Stardaret. price of. Nao matenial.cts Ks. lo per kg a _ Dparing. She Worth. of. Taneany, Rectal outpce of Binished preduct X_1s. S000 Mts, Rekral Quantity oF rau Material A 1S Udaakg, Aetual Quantity of cauonudlerial B is SMoo K4 ana_Actual Quantity. ot xaw watevial c 1s Gooe kg Actual Price “perkg..is Bs Ugo to Kasmeterial A, Rs debe for Taw wakebial B. Ard RS MWe So. Sor rac material C.. Caleulate Matewal Variances... Wh, Madeviel Cast. Vaviance (MEN)_= Sdarclavd Cost oF Actual outut <-> Metal Cost uy Matettal Price Vaviance (MPM = _ : (Sted PCE > Acta PRICE) K Rectal ean krty cwo.. Mckee l_ Mix Navies ce (4M) “FReviseat starter early cm het awastty |x Stand Price, wy Material Yjeid Variance (MYW) Tistennl fistd Narang (seaneter oudtice from Aetial @ueakhlly Ca Retisl oth) x Stanelatel cack ferns sw) Material Gotantidy Ustiance (Mav) or Madevial nage Variance = —— eee (stardore qunebites vepived Tor Ack aukte co» Atel aratty xstantnd ice wm Mev + Mev wo Mev= Mev +MyV_ Scanned with CamScanner= Date ——Yatiadac Leucharrd Starland SHendeord Wuawhiky, “Rice Cesk Rave Material_A 5 ky cL Ze © Raws Materia ® 6 ks ‘3, men Raw Materiale 9_ks. \o ___4e Be ky _ _ \QQ& “Tatal__Starfard 1d rani S20 ky tht puck Pick = Bee Bissett Peose_soth se 18 — == 8875 _ Standard Mix Ratio __S" Ig" Gg", 4. kg “Festiculavet Ackunl Ache Ackual : Qsaudibyy “Paice Cost Rass Haderial A Ydceks Lg Qoibo Rawr Matera Loca ks W50 64000 (S600 ky \Ulooo Nebual Cock Winoo. Netual out Put = Sooo uurk

Actual Output 180 units | Q. LL. The standard cost of a certain ctiemical mixture is: 35% Material A at Rs. 25 per kg. \ 65% Material B at Rs. 36 per kg. + A standard loss of 5% is expected in production. During a period there is uséd: : 125 kgs. of Material A at Rs, 27 per kg. and 275 kgs. of Material B at Rs. 34 per kg. _ The actual output was 365 kgs. Calculate: (i) Material Cost Variance (ii) Material Price Variance (iii) Material Mix Variance (iv) sMaterial Yield Variance. 4 Scanned with CamScannerQ. 12. The standard cost on ‘Material’ and ‘Labour’ for the making of a unit of a certain product is estimated as under : Material 80 kg, at Rs. 1.50 per kg, Labour 18 hrs. at Rs. 1.25 per hr. On completion of the production of a unit, it was found. that 75 kg of material costing Rs. 1.75 per kg has been consumed and that the time taken was 16 hours, the wage rate being Rs. 1.50 per hour, You are required to analysematerial and labour variances. Q.13. The following information is available from the cost records of a company for December, 2006 : ; . Materials purchased 20,000 pieces fe ao Materials consumed 19,000 pieces Actual wages paid for 4,950 hours 24,750 Fixed factory overheads budgeted 40,000 Fixed factory overheads incurred 44,000 Units produced—1800 Standard rates and prices are Direct material rate—Rs. 4 per piece | Standard input—10 pieces per unit Direct labour rate—Rs. 4 per hour Standard hours required to produce a unit—2.5 hours Overheads—Rs. § per labour hour, Compute the following variances : (a) Material price and usage; (b) Labour rate and efficiency; (c) Fixed oyerheads expenditure variance; (d) Fixed overheads volume varianée, Q.14. Data relating to a job arelas follows: Standard rate of wages per hour Rs. 10 Standard hours 300 Actual rate of wages per hour Rs. 12 Actual hours 200 You are required to calculate: (i) Labour Cost Variance, * (ii) Labour Rate Variance, oft) Labour Efficiency Variance. Q.15. (a)From the following data, calculate the following variances: (i) Material Cost Variance; (ii) Material Price Variance; (iii) Material Quantity Variance; (iv) Material Mix Variance; (v) Material Yield Variance. 5 Scanned with CamScannerMaterial Standard Actual Qty. Unit Qty. Unit Price Price “A 60% Rs. 20 88 Rs.|30 8 40% Rs, 10 132 Rs. 10 Standard loss: 10% Actual output: 180 units. (6) A company has a normal capacity of 120 machines working 8 hours per day of 25 days ina month, The fixed overheads are budgeted at Rs. 1,44,000 per month. The standard time required to manufacture one unit of production is 4 Hours. In April 2006, the company worked 24 days of 840 machine hours per day and produced 5,305 units of output. The actual fixed overheads were Rs. 1,42,000. Compute: —_— (i) Efficiency Variance; (ii) Capacity Variance; (iii) Calendar Variance. Q.16. The standard labour component and the actual labour component engaged in a week for a job are as under: Skilled — Semi-skilled Unskilled workers workers workers (a) Standard number of workers in the gang 32 12 6 (b) Standard wage rate \ per hour (Rs.) 3 2 1 (c) Actual number of workers employed in the gang during the week 28 18° 4 (d) Actual wage rate per - . hour (Rs.) 4 Sie 2 i During the 40-hour working week, the gang produced 1,800 standard labour hours of work. 4 Calculate the different labour variances. t y Q.17. A group of 10 skilled and 20 unskilled workers was expected to produce 400 kg of Chernical BXT in an 8 hour day. The standard hourly wage rate was fixed at Rs. 25 and Rs. 15 respectively. Actually, a group of 15 skilled and 10 unskilled workers was deployed and paid for 8 hour day at an hourly wage rate of Rs. 22 and Rs. 18 respectively. Two hours were wasted for the entire group due to power failure and only 300 kg of BX was produced. | You are required to compute : (i) Labotr ‘Cost Variance; (ii) Labour Rate Variance; (iii) Idle Time Variance; (iv)Labour Usage Variance; (v) Labour Mix Variance; (vi) Labour Yield Variance. ; 6 Scanned with CamScannerQ.18. The budgeted and actual sales of XYZ Ltd. are as follows : Budgeted Sales = 10,000 units at Rs. 4 per unit Actual Sales = 5,000-units @ Rs. 3.50 per unit 8,000 units @ Rs. 4 per unit Calculate : (i) Sales Value Variancé (ii) Sales Price Variance (iii) Sale Volume Variance Q.19. (a). Calculate labour variances from the following information ; Actual hours 5,800 Acitial direct wages Rs. 1,800 Standard rate per hour Re. 0.35 6,000 Standard’ hours (b) Finolex Co. uses a standard cost system and manufactures product Z. Standard cost per 1,000 kg of output is as under : Quantity (in kg) Price (in Rs.) Material A . 800 2.50 B 200 4.00 ¢ 200 1.00 In March 2007, the company produced 2,00,000 kg of output. Actual consumption was : “Material : . -A: 1,57,000 kg @ Rs. 2.40; B: 38,000 kg @ Rs. 4.20; C: 36,000 kg @ Rs. 1.10 Calculate material variances. Q. 20. Greenfield Co. provides the following data for the month of March 2007: Budget : Product Budgeted sales Budgeted selling ‘ (in units) ~ price per unit (Rs.)} A * 2,160 12 [_B 1440 5 Actual : Product ‘Actual sales Actual selling (in units) price per unit (Rs. A 2,240 u B = 960 6 You are required to compute : ( Sales value variance; (ii) Sales price variance; Q.21. Explain the nature and scope of ‘cost control’ and ‘cost reduction’, Which of the fwvo is superior? (i) Sales volume variance; (iv) Mix variance. i 7 Scanned with CamScannerQ.22. A company using, standard costing system presents the followinB information for the budget period : ‘ : Budgeted variable overheads = Rs. 8,00,000 Budgeted fixed overheads = Rs. 5,00,000 Overheads are recovered on the basis of standard machine hours. The company had budgeted for 1,00,000-machine hours for the year. During the budget period the company used 1,10,000 machine hours while it, should have used 95,000 machine houis for actual output. Actual variable overheads Re, 8,00,000 Actual fixed overheads’ Re, 4,70,000 Calculate the following variances : , (9 Variable overheads cost variance; (i) Variable overheads spending variance; (ii) Variable overheads efficiency variance; (i) Fixed overheads cost variance; i : (®). Fixed overheads expenditure variance; (A Fixed overheads volume variance; : a (vi) Fixed ovecheads efficiency variance; (vii) Fixed overheads capacity variance. Q.23.Standard labour cost of producing 40 units of a product is 30 hours work by skilled workers at a standard rate of Rs. 60 per hour and 90 hours work by unskilled workers at the standard rate of Rs. 20 per hour. 40 units of the product were produced for which skilled workers were paid for 20 hours at Rs. 55 per’ hour and unskilled workers were paid for 130 hours at Rs. 24 per hour. Due to: a machine break-down both skilled and unskilled workers lost 9 hours each. They were paid even for this time. Calculate : : oa () Labour cost variance; . ‘ i (i) Labour rate variance; i (ii) Labour efficiency variance unadjusted; ' ‘ (fv) Labour mix variance; \ (v) Labour yield variance; t (i) Idle time variance. | | Q.24. Standard material cost for manufacturing 1,000 Units of output is 400 | kg of material at Rs, 2.50 per kg, When.2,000 units are produced itis found that | actual gost is 825 kg of material at Rs. 2.70 per kg. Calculate material cost | variance, material price variance and material usage variance. ' Scanned with CamScannerQ. 25. From the following data calculate overhead variances: Fixed overhead Rs. 10,200 Variable overhead Rs. 14,250 | Normal capacity 10,000 standard hours Budgeted rate—Fixed overhead Re. 1 per hour —Variable overhead Rs. 1.70 per hour Actual level —8,000 standard hours. Required: Variable overhead cost variance and fixed overhead cost, budget and volume variances. (b) Standard, hours for producing two products A and B are 15 hours and 20 hours per unit respectively. Both products require identical type of labour and the standard wage rate is Rs. 5 per hour. In a year 10,000 units of A and 15,000 units of B were produced. The total |abour hours actually worked were 4,50,500 and actual wage bill came to Rs. 23,00,000. This included 72,000 hours paid for at Rg. 7 per hour and 9,400 hours paid for @ Rs. 7.50 per hour, the balance having been paid at Rs. 5 per hour. You are required to compute labour cost variance, labour rate variance and labour efficiency variance. Scanned with CamScanner(ar . Modem Tiles Ltd. makes plastic tiles of standard slze of 6"x6"* + From the following information you are required to calculate _for direct materials: °° (i) the cost variance {n total : ! (ii) the cost variance sub-divided into (a) price (b) usage and (ii) the usage variance analysed to. show (a) mixture (b) yield. .A standard mix of the compound required to produce an output of 20,000 square feet of tiles of. +” thickness * follows ; Price (Ra. per Kg.) 0.65 0.40 ight mixes were processed and actual Price (Ra, pr Ke During December 1691, ef materials consumed were : A 0.45 Actual production for December was 6,20,000 tiles. (27) Eskay Ltd., produces an article by blendixig two basic raw materials. The following standards have been: set up for raw materials + : ’ : Material The standard loss is processing ie 16%. .D 1990, the company produced 1,700 kg. of finished output. The position of stock and purchases for the month of September, 1990, is as under : 7 . Stock on 1.0.60 Calculate the following varlances ; (a) Materials price variance (b) Materials usage variance \ (c) Materials yield variance (d) Materials mix variance {e} Total materials cost variance, Assume first’ in first out method for issue of material. Scanned with CamScanner