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  3. the following data relates to company x ltd for 20

The following data relates to company X Ltd for 2019 and 2020: ...

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Accounting

The following data relates to company X Ltd for 2019 and 2020:

2019 2020

Used direct material (kg) 46,000 kg 45,000 kg

Cost direct material (per kg) $11.50 $10.50

Produced (units) 15,000 units 11,000 units

Required:

Calculate the cost effect of growth for direct materials. Show all workings and clearly indicate whether the effect is favourable (F) or unfavourable (U).

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