Deadeye operates a standard costing system in which all inventories are valued at standard cost....
70.2K
Verified Solution
Link Copied!
Question
Accounting
Deadeye operates a standard costing system in which all inventories are valued at standard cost. The standard direct material cost of one unit of product MS is $36, made up of 48 kg of material H at $750 per kg. Material H is used only in the manufacture of product MS. The following information relates to last month:
| Material H: | |
| Purchased | 40,000 kg for $294,000 |
| Issued into production | 36,500 kg |
| The finished output of MS | 7,200 units |
Required:
(a) Calculate the direct material price and usage variances for last month. (3 marks)
(b) Prepare a statement that reconciles the actual cost of material H purchased with the standard material cost of actual production of MS for last month. The statement should incorporate the variances calculated in (a). (3 marks)
(c) (i) Suggest ONE possible cause for EACH of the variances calculated in (a). (2 marks)
(ii) State to whom the direct material price variance should be reported and why. (2 marks) (10 marks)
Get Answers to Unlimited Questions
Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!
Membership Benefits:
- Unlimited Question Access with detailed Answers
- Zin AI - 3 Million Words
- 10 Dall-E 3 Images
- 20 Plot Generations
- Conversation with Dialogue Memory
- No Ads, Ever!
- Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
Other questions asked by students
StudyZin's Question Purchase
1 Answer
$0.99
(Save $1 )
One time Pay
- No Ads
- Answer to 1 Question
- Get free Zin AI - 50 Thousand Words per Month
Unlimited
$4.99*
(Save $5 )
Billed Monthly
- No Ads
- Answers to Unlimited Questions
- Get free Zin AI - 3 Million Words per Month
*First month only
Free
$0
- Get this answer for free!
- Sign up now to unlock the answer instantly
You can see the logs in the Dashboard.