North American market, requires a special plastic. During the quarter ending 30 June, the company manufactured 40,000 helmets, using 27,500 kilograms of plastic in the process. The plastic cost the company RM 195,250. (The currency in Malaysia is the ringgit, which is denoted here by RM.)

According to the standard cost card, each helmet should require 0.6 kilograms of plastic, at a cost of RM 8.1 per kilogram.

1a. What cost for plastic should have been incurred in the manufacture of the 40,000 helmets?
1b. How much greater or less is this than the cost that was incurred?

2. Break down the difference computed above in terms of a materials price variance and a materials quantity variance.

 

Transcribed Image Text:

Actual Quantity of Inputs, at Actual Price Actual Quantity of Inputs, at Standard Price Standard Quantity Allowed for Output, at Standard Price RM RM RM Price Variance Quantity Variance RM RM Total Variance RM Actual Quantity of Inputs, at Actual Price Actual Quantity of Inputs, at Standard Price Standard Quantity Allowed for Output, at Standard Price RM RM RM Price Variance Quantity Variance RM RM Total Variance RM

Answer rating: 100% (QA)

Answer 1 Calculatlon of Standard materlal cost allowed to make 3100 helmets Standard m... View the full answer