(A) Material Cost Variances

Question:1
The standard mix of product is:a

Product
Basis Total
X 60 units@ 15 paise per unit
80 units@ 20 paise per unit
Z
100 units @ 25 paise per 240 units
10units of the finished product should be obtained from thisunit
mix. During the month of February, ten
mixes were completed and the consumption was as under: -
Product
X
Basis Total
640 units @ 20 paise per unit
960 units @ 15 paise per unit
840 units @ 30 paise
per unit 2,440 units
Actual output was 90 units. Calculate all material variances.
Question :2
A certain insecticide is manufactured by mixing four chemicals a, b, c and d (filter) and processing the
same. The standard cost data for the product is as follows:
Material Quality (standard proportion) Standard price/kg ()
A 5 kg 200
B 20 kg 50
25 kg 20
D (filter) 50kg
Total input 100 kg
Loss in processing (5kg)
Net input 95 kg
During April,2012, 19,000kg of insecticide was producedincurring actual cost as follows:
Product A-1,010 kg B-4,200 kg C-4,800 kg D-10,200 kg
Amount () 2,12,100 2,05,800 1,00,80 66,300
Calculate the following variances: -
(a) Material cost variance (b) Material price variance
(c) Material mix variance (d) Material yield variance (e) Material usage variance
Question:3
nestandard cost of a certain chemical mixture was: -
b0% of material 'A' at 2,500 per tonne 40% of material "B at 3,S00 per tonne
A
Standard loss of 10% is expected in production. Following materials were consumed during the
period under consideration:
2tonnes of material 'A' at 2,300 pertonneLoss in production was 29 tonnes
85tonnes of material 'B' at 3,600 per tonne
TOU are
required to calculate: (a) Material price variance (b) Material usage variance
(c) Material mix variance (d) Material yield variance
Question :4
The
e standard costofa chemical mixture 'AB' is:
40% of material 'A' at 400 per kg. 60% of material "B'
at R 600 per kg.
star
andard loss of 10% is anticipated in production. he rolowing particulars are available for thee
month of
December, 2009:
180
Tgof material 'A' has been used at 360 per kg. | 220
KE Or material 8' has been used at 680 per kg.
(alhtualproduction of 'AB' is 369 kg. You are required to calculate: - -

a) Material cost (b) Material price variance

a) variance
Material mix variance (c) Material usage variance
(e) Material yield variance
Question:5
RS Limited has established the following standard mix for producing 9 tonnes of product 2.
Particulars Total
5 tonnes of material 'A' at 7 7 per tonnes = { 35
3 tonnes of material 'B' at R 5 per tonnes 15
2 tonnes of material'C at 2 pertonnes = 4
A standardloss of 10% of input is expected to occur. Actual input was as under
53,000 tonnes of material 'A' at 7 per tonnes 19,000 tonnes of material"'C' at 2.20 pertonne
28,000 tonnes of material '8' at ? 5.30 per tonnes
Actual output for a period was 92,700 tonnes of product 2. Compute material cost variances.
Question:6
80 kgs. of material a at a standard price of 2 per kg. and 40 kg. of material 'B' at a standard price of
5 per kg. were to be used to manufacture 100 kgs. of a chemical. During a month, 70 kgs. of
material
'A priced
at2.10 per kg. and 50 kgs. of material
'B' priced at 4.50 per kg. Were actually used and
the output ofthe chemical was 102 kgs. Find out the material variances
Question :7
Tutu Limited manufactures asimple product,the standard mix of which is: -
Material A' 60% at 20 per kg. Material B' 40% at 10 perkg.
Normal loss in production is 20% of input. Due to shortage of material 'A', the standard mix wa
changed. Actual results for March, 2009 were: -

Material 'A'105 Kg. 20 per kg. Input Loss Output

Material B'95 Kg. @9 per kg 200Kg 35 165 Kg.
You are required to calculate: -

(a) Material price variance (b) Material usage variance

(c)Material mix variance (d) Material yield variance
(B) Labour Cost Variances
Question:8
A company produces only one article, the prime cost standards for which have been established as: -
Percompleted piece Material 5 lbs. @R4.20- 21 Labour hours
The production schedule for the month of July 2018 required completion 3of 5,0003.00-79
5,120 pieces were actually completed. Purchases for the month of pieces. However
of material at the total invoice
July 2018 amounted to 30,000 lbs.
price of T 1,35,000. Production records for the month of July, 2018
showed the following actuals results: -
Materials used -25,700 lIbs.
Direct labour (15,150 hours) - T 48,480
Calculate appropriate material and labour variances.
Question:9
The following information is gathered from the labour
records of P Limited:
(a) Payment for direct labour 20,000.
(b) Time card analysis shows that 9,000 hours were worked
(c) Production reports for the period showed that 4,000 unitsproduction
ines.
have been completed.
(d) Each having standard labour time of 1% hours.
(e) Standard labour rate of 2 per hour.
Calculate the labour variances.
Question:10
100 skilled workmen, 40 semi-skilled workmen and 60 unskilled
workmen were to work for 30 hours
to get a contract job completed. The standard hourly
wages were R 60, R 36 and 24 respectively. The
iob was completed in 32 hours by 80 skilled, 50 semi-skilled and 70
unskilled workmen who were paid
F 65, 7 40 and 20 respectively as hourly wages. Find
out the labour cost variance, labour rate
variance, labour mix variance and labour efficiency variance.
Question:
11 | Nov 2012, CA *
The standard labour employment and
The the actual labour engaged in a 40-hours week fora job are as:-
Standard Actual
Particulars
No. of Workers Wage per hour ()
65
No. of Workers Wage rate per hour (R)|
Skilled 45 50 50
Semi-skilled 20 30 30 35
Unskilled 15 15 20 10
Standard output -2,000 units, actual output 1,800 units, abnormal idle time
-

2 hours in the week.

Calculate the labour cost variance.