Question 5.1

QUESTION 5 Answer the questions from the information provided. 5.1 5.1.1 Use the information provided below to calculate and comment on the following variances. Direct material usage variance (3 marks) 5.1.2 Direct labour rate variance (3 marks) 5.1.3 Direct labour efficiency variance (3 marks) 5.1.4 Variable overhead expenditure variance (3 marks) INFORMATION Harpic Manufacturers makes and sells a single product from Project D. The company operates a standard costing system. Details of the budgeted and actual data for 2020 are as follows: Budgeted data Standard production costs per unit: Direct material 4 kg at a cost of R5 per kg Direct labour 2 hours at a cost of R4 per hour Variable overheads 2 hours at R2 per direct labour hour Standard production 12 000 units Actual data Direct material 41 000 kg @ R5.50 per kg Direct labour 19 000 hours @ R3.75 per hour Variable overheads R39 900 Production 10 000 units