QUESTION $5$

$(20$ MARKS$)$

$5\mathrm{.}1$

REQUIRED

Use the information provided below to calculate the following variances. In each case state whether the variance is favourable or unfavourable.

$5\mathrm{.}1\mathrm{.}1$

Materials issue price variance

$(3$ marks$)$

$5\mathrm{.}1\mathrm{.}2$

Materials quantity variance

$(3$ marks$)$

$5\mathrm{.}1\mathrm{.}3$

Labour rate variance

$(3$ marks$)$

$5\mathrm{.}1\mathrm{.}4$

Labour efficiency variance.

$(3$ marks$)$

INFORMATION

Standards:

The following standards were set by Asus Manufacturers for each unit of product Zap:

Raw materials: $3$ kilograms of Material K at a price of R$5$ per kilogram.

Direct labour: $2$ hours at a rate of R$100$ per hour.

Actual information for May $2024$:

$10000$ kg of Material K was purchased for R$53000.3000$ units of product Zap were produced using $8800$ kg of Material K$.$

The wage records showed that it took $6200$ hours at a cost of R$607600$ to produce the $3000$ units of product Zap.