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Kosasa Company produces and sells one product only, Sobolo, the standard cost for one unit being as follows. GHC Direct material A – 10 kilograms at Ghc 20 per kg 200 Direct material B – 5 litres at Ghc 6 per litre Direct wages – 5 hours at Ghc 6 per hour Fixed production overhead Total standard cost The fixed overhead included in the standard cost is based on an expected monthly output of 900 units. 30 30 50 310 Fixed production overhead is absorbed on the basis of direct labour hours. During March the actual results were as follows. Production Material A Material B 800 units 7,800 kg used, costing GHC159,900 4,300 litres used, costing GHC23,650 4,200 hours worked for GHC24,150 Direct wages Fixed production overhead GHC47,000 Required: I. a. Calculate price and usage variances for each material. b. Calculate labour rate and efficiency variances. c. Calculate fixed production overhead expenditure.

Kosasa Company produces and sells one product only, Sobolo, the standard cost for one unit being as follows. GHC Direct material A – 10 kilograms at Ghc 20 per kg 200 Direct material B – 5 litres at Ghc 6 per litre Direct wages – 5 hours at Ghc 6 per hour Fixed production overhead Total standard cost The fixed overhead included in the standard cost is based on an expected monthly output of 900 units. 30 30 50 310 Fixed production overhead is absorbed on the basis of direct labour hours. During March the actual results were as follows. Production Material A Material B 800 units 7,800 kg used, costing GHC159,900 4,300 litres used, costing GHC23,650 4,200 hours worked for GHC24,150 Direct wages Fixed production overhead GHC47,000 Required: I. a. Calculate price and usage variances for each material. b. Calculate labour rate and efficiency variances. c. Calculate fixed production overhead expenditure.

Principles of Cost Accounting
Principles of Cost Accounting
17th Edition
ISBN:9781305087408
Author:Edward J. Vanderbeck, Maria R. Mitchell
Publisher:Edward J. Vanderbeck, Maria R. Mitchell
Chapter8: Standard Cost Accounting—materials, Labor, And Factory Overhead
Section: Chapter Questions
Problem 17P: Shinto Corp. uses a standard cost system and manufactures one product. The variable costs per...
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Kosasa Company produces and sells one product only, Sobolo, the standard cost for one unit being as follows. GHC Direct material A – 10 kilograms at Ghc 20 per kg 200 Direct material B – 5 litres at Ghc 6 per litre Direct wages – 5 hours at Ghc 6 per hour Fixed production overhead Total standard cost The fixed overhead included in the standard cost is based on an expected monthly output of 900 units. 30 30 50 310 Fixed production overhead is absorbed on the basis of direct labour hours. During March the actual results were as follows. Production Material A Material B 800 units 7,800 kg used, costing GHC159,900 4,300 litres used, costing GHC23,650 4,200 hours worked for GHC24,150 Direct wages Fixed production overhead GHC47,000 Required: I. a. Calculate price and usage variances for each material. b. Calculate labour rate and efficiency variances. c. Calculate fixed production overhead expenditure.
Transcribed Image Text:Kosasa Company produces and sells one product only, Sobolo, the standard cost for one unit being as follows. GHC Direct material A – 10 kilograms at Ghc 20 per kg 200 Direct material B – 5 litres at Ghc 6 per litre Direct wages – 5 hours at Ghc 6 per hour Fixed production overhead Total standard cost The fixed overhead included in the standard cost is based on an expected monthly output of 900 units. 30 30 50 310 Fixed production overhead is absorbed on the basis of direct labour hours. During March the actual results were as follows. Production Material A Material B 800 units 7,800 kg used, costing GHC159,900 4,300 litres used, costing GHC23,650 4,200 hours worked for GHC24,150 Direct wages Fixed production overhead GHC47,000 Required: I. a. Calculate price and usage variances for each material. b. Calculate labour rate and efficiency variances. c. Calculate fixed production overhead expenditure.
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