1. A company manufacturing Distempers operates on a standard costing system.

The
standard cost of one of the products of the company shows the following standards:
MATERIAL

QUANTITY(KGS.)

STD. PRICE/KG.

TOTAL

40

75

3000

10

50

500

50

20

1000

MATERIAL COST PER UNIT

4500

The standard input mix is 100 kgs. And the standard output of the finished product is 90 kgs.
The actual results for period are:
A

240000KGS @Rs. 80/Kg

40000KGS @Rs. 52/Kg

220000KGS @Rs.21/Kg

Required to calculate all material variances.

2. Sudeep Processors Ltd. produces a commodity by blending two raw materials A and B. The
following are the details regarding the raw materials:
Material
Standard mix
Standard price per kg
A

30%

Rs.4.25

70%

Rs.3.50

The standard process loss is 10%. During the month of September 2007, the company produced
3,960 kg of finished product. The position of stock and purchases for the month of September
2007 is as under:
Material

Stock as on
September 01, 2007

Stock as on
September 30, 2007

46 kg

56 kg

1,740 kg

Rs.7,134

112 kg

2,660 kg

Rs.9,576

B
92 kg
The material yield variance of the company was
(a)
Rs.111.75 (A)
(b)
Rs.111.75 (F)
(c)
Rs.114.00 (A)
(d)
Rs.113.89 (F)
(e)
Rs.113.89 (A).

Purchases during
September 2007

3. Sigma Ltd. has furnished the following standard labor component and the actual labor
component for a job in a week:
Skilled
Semi-skilled
Unskilled
Particulars
workers workers
workers
i. Standard number of workers in the gang

32

12

ii. Standard wage rate per hour (Rs.)

12

10

28

18

14

iii. Actual number of workers

employed in the gang during the week
iv. Actual wage rate per hour (Rs.)

During the 40 hours working week, the gang produced 1,800 standard labor hours of work.
3. Vaishali Ltd. has furnished the following production budget pertaining to a single product for
the month of September 2007:
Production quantity
2,25,000 units
Production costs:
Material
3,85,000 kg at Rs.5.25 per kg
Direct labor
1,80,000 hours at Rs.5.10 per hour
Variable overheads
Rs.4,41,000
Fixed overheads
Rs.12,15,000
The variable overheads are absorbed at a predetermined direct labor hour rate and the fixed
overheads are absorbed at a predetermined rate per unit of output. During the month the actual
production was 2,15,000 units and the following costs were incurred:
Material
3,21,050 kg at Rs.15,85,785
Direct labor
1,68,880 hours at Rs.9,52,140
Variable overheads Rs.4,36,700
Fixed overheads
Rs.12,03,800
The variable overhead efficiency variance and fixed overhead volume variance were
(a)
Rs.7,644 (F) and Rs.54,000 (A) respectively
(b)
Rs.4,300 (F) and Rs.54,000 (A) respectively
(c)
Rs.4,300 (F) and Rs.11,200 (F) respectively
(d)
Rs.7,084 (F) and Rs.11,200 (F) respectively
(e)
Rs.7,644 (F) and Rs.26,000 (F) respectively.
4. Pummy Ltd. presents the following data for the 2nd quarter of 2007-08:
Particulars
Budget
Actual
Number of working days
65
72
Man hours per day
830
?
Output per man hour (units)
1
?
Total output (units)
53,950
75,325
Fixed overhead expenditure
Rs.86,320
Rs.88,100
The overhead efficiency variance of the company for the quarter was Rs.1,840 (F). The actual
man hours per day (approximately) were

(a)
(b)
(c)
(d)
(e)

1,062 hours
965 hours
1,177 hours
1,030 hours
1,141 hours.