Question 4 (29 marks) Berger Paints produces and sells a wide range of paints to its...

 

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Question 4 (29 marks) Berger Paints produces and sells a wide range of paints to its customers. It currently has a high- is grade paint that will attach to any surface without flaking or peeling. The purchasing manager responsible for buying the three ingredients (red paint, white paint and a specialized bonding agent) that are used to make pink paint whilst the production manager is responsible for mixing the paints and the volume and quality of green paint that is produced. The standard ingredients of the pink paint mix are as follows: 2 litres of red paint @ $2.50 per litre $ 5.00 7 litres of white paint @ $3.00 per litre $21.00 1 litre of bonding agent @ $10.00 per litre $10.00 Total cost of production for 9 litres of pink paint $36.00 $ 4.00 Standard cost of one litre of pink paint The Cost Accountant has provided the following data in relation to the production of 5,000 litres of pink paint. 1,000 litres of red paint @ $2.60 per litre 4,000 litres of white paint @ $3.10 per litre 500 litres of bonding agent @ $9.90 per litre 5,500 litres Required: $ 2,600 $12,400 $ 4,950 $19,950 Calculate the material price, mix and yield variances for Berger Paints. (10 marks) Question 4 (29 marks) Berger Paints produces and sells a wide range of paints to its customers. It currently has a high- is grade paint that will attach to any surface without flaking or peeling. The purchasing manager responsible for buying the three ingredients (red paint, white paint and a specialized bonding agent) that are used to make pink paint whilst the production manager is responsible for mixing the paints and the volume and quality of green paint that is produced. The standard ingredients of the pink paint mix are as follows: 2 litres of red paint @ $2.50 per litre $ 5.00 7 litres of white paint @ $3.00 per litre $21.00 1 litre of bonding agent @ $10.00 per litre $10.00 Total cost of production for 9 litres of pink paint $36.00 $ 4.00 Standard cost of one litre of pink paint The Cost Accountant has provided the following data in relation to the production of 5,000 litres of pink paint. 1,000 litres of red paint @ $2.60 per litre 4,000 litres of white paint @ $3.10 per litre 500 litres of bonding agent @ $9.90 per litre 5,500 litres Required: $ 2,600 $12,400 $ 4,950 $19,950 Calculate the material price, mix and yield variances for Berger Paints. (10 marks)

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