Reddoor Sdn. Bhd. uses a standard costing system to control the various costs of its business....

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Reddoor Sdn. Bhd. uses a standard costing system to control the various costs of its business. An extract from the company's operating system reveals the following variances: Direct material price variance Direct material usage variance Direct labour rate variance Direct labour efficiency variance RM 2,500 favourable 3,800 adverse 4,050 favourable 2,200 adverse Required: Explain ANY TWO (2) possible reasons that could have caused the above variances. Reddoor Sdn. Bhd. uses a standard costing system to control the various costs of its business. An extract from the company's operating system reveals the following variances: Direct material price variance Direct material usage variance Direct labour rate variance Direct labour efficiency variance RM 2,500 favourable 3,800 adverse 4,050 favourable 2,200 adverse Required: Explain ANY TWO (2) possible reasons that could have caused the above variances.

Answer rating: 100% (QA)

The variances mentioned in the extract indicate differences between the standard costs and the actual costs incurred by Reddoor Sdn Bhd in their operations Lets explore two possible reasons for each o... View the full answer