Question 2 SR Hargreeves Umbrella Sdn Bhd (SRHU) is one of the leading umbrella manufactures in Malaysia and China with over 20 years of experiences in the manufacture and export of quality umbrellas. The company is established in a bustling city of Georgetown, Penang on 1" October 1989. SRHU is market leader for umbrella in South East Asia. The company uses standard absorption costing. The following information was recorded by the company for October 2019: Budget Actual Output and sales (units) 17,400 16,400 RM RM Selling price per unit Variable cost per unit Total fixed overheads 52 62 20 22 34,800 37,000 The company's man agement accounting function is evolving in tandem with change in technology worldwide. Technology is the primary driver of organizational change. For example, the use of artificial intelligence (AÍ) and machine learning enables firms to automate their routine processes and reporting, thereby requiring their finance teams to seriously consider the use of real-time performance reporting to keep pace with their competitors. This paved the way to more finance function processes become automated, staff working in this area will spend less time collecting, cleaning and connecting data, and more time generating the insights required to create real value for the organization. Required: a) You are the junior accountant of the company and are required to calculate the following variances for October 2019: O The sales price variance (i) The sales volume profit variance (ii) The fixed overhead volume variance b) Highlight and discuss in detail at least two (2) possible insights that you as the management accountant could generate, which could create real value for SR Hargreeves Umbrella Sdn Bhd.

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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Question 2
SR Hargreeves Umbrella Sdn Bhd (SRHU) is one of the leading umbrella manufactures in Malaysia
and China with over 20 years of experiences in the manufacture and export of quality umbrellas. The
company is established in a bustling city of Georgetown, Penang on 14 October 1989. SRHU is
market leader for umbrella in South East Asia. The company uses standard absorption costing. The
following information was recorded by the company for October 2019:
Budget Actual
Output and sales (units) 17,400 16,400
RM
RM
Selling price per unit
Variable cost per unit
Total fixed overheads
52
62
20
22
34,800 37,000
The company's man agement accounting function is evolving in tandem with change in technology
worldwide. Technology is the primary driver of organizational change. For example, the use of
artificial intelligence (AÍ) and machine learning enables firms to automate their routine processes and
reporting, thereby requiring their finance teams to seriously consider the use of real-time performance
reporting to keep pace with their competitors. This paved the way to more finance function processes
become automated, staff working in this area will spend less time collecting, cleaning and connecting
data, and more time generating the insights required to create real value for the organization.
Required:
a) You are the junior accountant of the company and are required to calculate the following
variances for October 2019:
(0)
The sales price variance
(i) The sales volume profit variance
(ii)
The fixed overhead volume variance
b) Highlight and discuss in detail at least two (2) possible insights that you as the management
accountant could generate, which could create real value for SR Hargreeves Umbrella Sdn Bhd.
Transcribed Image Text:Question 2 SR Hargreeves Umbrella Sdn Bhd (SRHU) is one of the leading umbrella manufactures in Malaysia and China with over 20 years of experiences in the manufacture and export of quality umbrellas. The company is established in a bustling city of Georgetown, Penang on 14 October 1989. SRHU is market leader for umbrella in South East Asia. The company uses standard absorption costing. The following information was recorded by the company for October 2019: Budget Actual Output and sales (units) 17,400 16,400 RM RM Selling price per unit Variable cost per unit Total fixed overheads 52 62 20 22 34,800 37,000 The company's man agement accounting function is evolving in tandem with change in technology worldwide. Technology is the primary driver of organizational change. For example, the use of artificial intelligence (AÍ) and machine learning enables firms to automate their routine processes and reporting, thereby requiring their finance teams to seriously consider the use of real-time performance reporting to keep pace with their competitors. This paved the way to more finance function processes become automated, staff working in this area will spend less time collecting, cleaning and connecting data, and more time generating the insights required to create real value for the organization. Required: a) You are the junior accountant of the company and are required to calculate the following variances for October 2019: (0) The sales price variance (i) The sales volume profit variance (ii) The fixed overhead volume variance b) Highlight and discuss in detail at least two (2) possible insights that you as the management accountant could generate, which could create real value for SR Hargreeves Umbrella Sdn Bhd.
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