calculate material cost variance price variance quantity variance mix variance and y 666330
ABC Ltd. produces an article by blending two basic raw materials. It operates a standard costing system and the following standards have been set for raw materials.
|
Material |
Standard Mix |
Standard Price |
|
A |
40% |
Rs.4.00 |
|
B |
60% |
Rs.3.00 |
The standard loss in processing is 15%. During September 2007, the company produced 1, 700 kg of finished output.
The position of stock and purchases for the month of September 2007 is as under,
|
Material |
Quantity as on |
Quantity as on |
Purchases |
Cost |
|
|
1/9/2007 Kg |
30/9/2007 Kg |
Kg |
Rs. |
|
A |
35 |
5 |
800 |
3, 400 |
|
B |
40 |
50 |
1, 200 |
3, 000 |
Calculate Material Cost Variance, Price Variance, Quantity Variance, Mix Variance and Yield Variance. Assume that First In First Out method is followed for material issues