INFORMATION RegalLtd uses the standard costing system. The standards and actual information for May 2022 for the only product that it manufactures are as follows: STANDARDS Direct materials.............................4kg @ R7 per kg Direct labour..................................5 hours @ R60 per hour Variable manufacturing overheads..R12 per labour hour Normal production.........................12 000 units per month ACTUAL INFORMATION FOR MAY 2022: Direct materials used.......................43 000kg @ R7.50 per kg Direct labour.....................................56 000 hours @ R58 per hour Variable manufacturing overheads...R649 600 Production........................................11 000 units manufactured Use the information to calculate the following variances. In each case state whether the variance is favourable or unfavourable 3.1 Material quantity variance 3.2 Labour efficiency variance 3.3 Variable manufacturing overheads expenditure variance

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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INFORMATION

RegalLtd uses the standard costing system. The standards and actual information for May 2022 for the only product that it manufactures are as follows:

STANDARDS

Direct materials.............................4kg @ R7 per kg

Direct labour..................................5 hours @ R60 per hour

Variable manufacturing overheads..R12 per labour hour

Normal production.........................12 000 units per month

ACTUAL INFORMATION FOR MAY 2022:

Direct materials used.......................43 000kg @ R7.50 per kg

Direct labour.....................................56 000 hours @ R58 per hour

Variable manufacturing overheads...R649 600

Production........................................11 000 units manufactured

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

3.1 Material quantity variance

3.2 Labour efficiency variance

3.3 Variable manufacturing overheads expenditure variance

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