- 21 AaBbCd AaBbcc AaBbci AaBbc 1 Normal * No Spac... Heading 1 Heading Paragraph Styles =) Sally is reviewing last month's performance of Leeds division due to large variances flagged up in the system. Sally has asked you to analyse the variances and identify possible causes. You should make reasonable assumptions to apply appropriate management accounting tools or techniques to investigate the issues and identify responsible individuals/ departments who should be held responsible. In addition, you should suggest different ways managers could improve the division's performance by providing evidence from existing research The division produces premium day cream and the standard cost of 100 ml cream in cosmetic tubes is provided below Cost category Standard quantity Standard cost per 100 ml Direct materials Material A Material B Direct labour Variable manufacturing overhead 0.5 kg 0.25 litres 2 hours 30 minutes 25 15 40 25 The company targets to sell 48,000 cosmetic tubes per year at a price of 180 per tube Fixed manufacturing overheads are applied on the basis of direct labour hours The budgeted fixed overhead of the division including common costs is 1.800.000 annually at a planned activity level of 96.000 direct labour hours The actual data retrieved at the end of the month is as follows Quantity Total revenue 47 600 Last Modified 18 Jul View View Help DE E AL AaBbCd AaBbcd AaBbcc Aabbccc T Normal 1 No Spac... Heading 1 Heading 2 Styles Paragraph Standard quantity Standard cost per 100 ml Cost category Direct materials Material A Material B Direct labour Variable manufacturing overhead 0,5 kg 0.25 litres 2 hours 30 minutes 25 15 40 525 The company targets to sell 48,000 cosmetic tubes per year at a price of 180 per tube Fixed manufacturing overheads are applied on the basis of direct labour hours. The budgeted fixed overhead of the division including common costs is 1,800,000 annually at a planned activity level of 96,000 direct labour hours per year The actual data retrieved at the end of the month is as follows Quantity Total revenue/ costs () Production and sales 4,200 tubes 747.600 Direct material purchased Material A 2.200 kg 121,000 Material B 1.125 litres 66.375 Direct material used Material A 2.000 kg Material B 1.050 litres Direct labour 8,800 hours 180.400 Vanable manufacturing overhead 2.050 hours 106 600 Fixed manufacturing overhead 180.000