Selling price (per unit) Units in opening inventory Units manufactured Units sold Units in closing inventory 100 Variable costs per unit: Direct materials R12,00 Direct labour R50,00 Variable manufacturing overhead Variable selling and administrative R10,00 Fixed costs: R81 000 Fixed manufacturing overhead Fixed selling and administrative R19 000 The company produces the same number of units every month, although the sales in units vary from month to month. The company's variable costs per unit and total fixed costs have been constant from month to month. (where applicable, round off amounts to two decimal places) R6,50 R 116 600 2 550 3050
Selling price (per unit) Units in opening inventory Units manufactured Units sold Units in closing inventory 100 Variable costs per unit: Direct materials R12,00 Direct labour R50,00 Variable manufacturing overhead Variable selling and administrative R10,00 Fixed costs: R81 000 Fixed manufacturing overhead Fixed selling and administrative R19 000 The company produces the same number of units every month, although the sales in units vary from month to month. The company's variable costs per unit and total fixed costs have been constant from month to month. (where applicable, round off amounts to two decimal places) R6,50 R 116 600 2 550 3050
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Variance Analysis
In layman's terms, variance analysis is an analysis of a difference between planned and actual behavior. Variance analysis is mainly used by the companies to maintain a control over a business. After analyzing differences, companies find the reasons for the variance so that the necessary steps should be taken to correct that variance.
Standard Costing
The standard cost system is the expected cost per unit product manufactured and it helps in estimating the deviations and controlling them as well as fixing the selling price of the product. For example, it helps to plan the cost for the coming year on the various expenses.
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Question
ParticularsAmountDirect materialR12Direct laborR50Variable manufacturing overheadR6.50Fixed manufacturing overhead (R81,000/2,550 units)R31.76Unit product cost for the month under absorption costingR100.26
Prepare an income statement for the month using the Marginal costing method
Transcribed Image Text:Selling price (per unit)
R 116
Units in opening inventory
600
Units manufactured
2 550
Units sold
3 050
Units in closing inventory
100
Variable costs per unit:
Direct materials
R12,00
Direct labour
R50,00
Variable manufacturing overhead
Variable selling and administrative
R10,00
Fixed costs:
Fixed manufacturing overhead
R81 000
Fixed selling and administrative
R19 000
The company produces the same number of units every month, although the sales in units vary from month to month. The
company's variable costs per unit and total fixed costs have been constant from month to month.
(where applicable, round off amounts to two decimal places)
R6,50
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