Clothing Division: Areeb Khan, the managing director of the Appliance Hub Group has asked you to...

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Clothing Division: Areeb Khan, the managing director of the Appliance Hub Group has asked you to compare the budgeted data to actual information for the men's jeans product line for the month of December 2022. She has given you the following information: Appliance Hub uses a standard absorption costing system. The standard production requirements to produce six pairs of jeans are 15 meters of material and 4 hours of direct labor. Overheads are applied on the basis of direct labor hours and have been determined based on an annual capacity of 57 600 pairs of jeans. At this level, overhead is 25% fixed and 75% variable. Material price is budgeted at R4/metre while direct labor is expected to cost R20/hour. The budgeted rate for total overheads is R13.50 per hour. Variable overhead costs vary with direct labor hours. Actual information for the month of December 2022: 4 680 pairs of jeans were produced, using 12 500 metres of material. Material purchased and issued to production in December cost R35 200. The labor rate actually paid in December was 17.5% higher than budgeted. The total labor hours worked for the month of December was 3 220. The total overhead rate for the month amounted to R14 per hour, of which 75% was variable. Clothing Division: Areeb Khan, the managing director of the Appliance Hub Group has asked you to compare the budgeted data to actual information for the men's jeans product line for the month of December 2022. She has given you the following information: Appliance Hub uses a standard absorption costing system. The standard production requirements to produce six pairs of jeans are 15 meters of material and 4 hours of direct labor. Overheads are applied on the basis of direct labor hours and have been determined based on an annual capacity of 57 600 pairs of jeans. At this level, overhead is 25% fixed and 75% variable. Material price is budgeted at R4/metre while direct labor is expected to cost R20/hour. The budgeted rate for total overheads is R13.50 per hour. Variable overhead costs vary with direct labor hours. Actual information for the month of December 2022: 4 680 pairs of jeans were produced, using 12 500 metres of material. Material purchased and issued to production in December cost R35 200. The labor rate actually paid in December was 17.5% higher than budgeted. The total labor hours worked for the month of December was 3 220. The total overhead rate for the month amounted to R14 per hour, of which 75% was variable.

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ANSWER To compare the budgeted data to the actual information for the mens jeans product line for the month of December 2022 we need to calculate the ... View the full answer