QUESTION $2$

$(25$ Marks$)$ Elix Ltd

REQUIRED

Study the information given below and calculate the following variances:

$2\mathrm{.}1$

Total material variance

$(3$ marks$)$

$2\mathrm{.}2$

Material mix variance

$(3$ marks$)$

$2\mathrm{.}3$

Material yield variance

$(3$ marks$)$

$2\mathrm{.}4$

Fixed manufacturing overheads volume capacity variance

$(3$ marks$)$

$2\mathrm{.}5$

Fixed manufacturing overheads volume efficiency variance

$(3$ marks$)$

$2\mathrm{.}6$

Total fixed overheads variance $($without using the expenditure and volume variances$)$

$(3$ marks$)$

$2\mathrm{.}7$

Total labour variance $($without using the efficiency and expenditure variances$)$

$(4$ marks$)$

$2\mathrm{.}8$

Sales price variance.

$(3$ marks$)$

Note: Each answer must indicate whether the variance is favourable $($F$)$ or unfavourable $($U$).$

INFORMATION

Elix Ltd produces a single product. The planned production for March $2018$ was $12000$ units.

The standard selling price and costs related to this product are as follows:

Per unit

R

Selling price

$264\mathrm{.}00$

Direct materials:

Material A: $1\mathrm{.}5$ kg at R$45$ per kg

$67\mathrm{.}50$

Material B: $3$ kg at R$30$ per kg

$90\mathrm{.}00$

Direct labour $(4\mathrm{.}5$ hours at R$24$ per hour$)$

$108\mathrm{.}00$

Variable overheads $(4\mathrm{.}5$ hours at R$6$ per hour$)$

$27\mathrm{.}00$

Total fixed overheads for March $2018$ were budgeted at R$432000.$

ds $4$

The actual results for March $2018$ were as follows:

R

Sales $(13500$ units$)$

$3726000$

Direct materials:

Material A: $($R$48$ per kg$)$

$1008000$

Material B: $($R$27$ per kg$)$

$1107000$

Direct labour $(42750$ hours$)$

$1154250$

Variable overheads

$229500$

Fixed overheads

$450000$