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Kranberry Networks Ltd had implemented a standard costing system to aid it in assessing the performance of its operations. In the first quarter of the current year, the company had the following variances: Direct materials price variance Direct materials quantity variance Direct labour rate variance £1,200 favourable £324 unfavourable £3,375 favourable £ 90 unfavourable Direct labour efficiency variance The following additional information is provided for the first quarter: 4.00 kg £ 7.00 3.00 hours £ 8.25 £42,000 £37,125 Actual quantity of raw materials used per unit Actual cost of raw material per kg Actual time taken to manufacture one unit Actual wage rate per hour Actual cost of direct material purchased and used Actual direct wages paid The company hired a new supervisor in the beginning of the second quarter. Based on the supervisor's inputs, the company replaced faulty machines. The company has reskilled its labour workforce to bring in efficiency in its production process. The company's cost records for the second quarter of the year are given below: Actual quantity of raw materials used per unit Actual cost of raw material per kg Actual time taken to manufacture one unit 3.50 kg 6.50 2.50 hours £ Actual wage rate per hour Actual cost of direct material purchased and used Actual direct wages paid 8.50 £ 34,125 £ 31,875

Kranberry Networks Ltd had implemented a standard costing system to aid it in assessing the performance of its operations. In the first quarter of the current year, the company had the following variances: Direct materials price variance Direct materials quantity variance Direct labour rate variance £1,200 favourable £324 unfavourable £3,375 favourable £ 90 unfavourable Direct labour efficiency variance The following additional information is provided for the first quarter: 4.00 kg £ 7.00 3.00 hours £ 8.25 £42,000 £37,125 Actual quantity of raw materials used per unit Actual cost of raw material per kg Actual time taken to manufacture one unit Actual wage rate per hour Actual cost of direct material purchased and used Actual direct wages paid The company hired a new supervisor in the beginning of the second quarter. Based on the supervisor's inputs, the company replaced faulty machines. The company has reskilled its labour workforce to bring in efficiency in its production process. The company's cost records for the second quarter of the year are given below: Actual quantity of raw materials used per unit Actual cost of raw material per kg Actual time taken to manufacture one unit 3.50 kg 6.50 2.50 hours £ Actual wage rate per hour Actual cost of direct material purchased and used Actual direct wages paid 8.50 £ 34,125 £ 31,875

Managerial Accounting: The Cornerstone of Business Decision-Making
Managerial Accounting: The Cornerstone of Business Decision-Making
7th Edition
ISBN:9781337115773
Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Publisher:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Chapter10: Standard Costing And Variance Analysis
Section: Chapter Questions
Problem 46E: Refer to the information for Cinturon Corporation on the previous page. Required: 1. Break down the...
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Kranberry Networks Ltd had implemented a standard costing system to aid it in assessing the performance of its operations. In the first quarter of the current year, the company had the following variances: Direct materials price variance Direct materials quantity variance Direct labour rate variance Direct labour efficiency variance £1,200 favourable £ 324 unfavourable £3,375 favourable £ 90 unfavourable The following additional information is provided for the first quarter: Actual quantity of raw materials used per unit Actual cost of raw material per kg Actual time taken to manufacture one unit Actual wage rate per hour Actual cost of direct material purchased and used Actual direct wages paid 4.00 kg £ 7.00 3.00 hours £ 8.25 £42,000 £37,125 The company hired a new supervisor in the beginning of the second quarter. Based on the supervisor's inputs, the company replaced faulty machines. The company has reskilled its labour workforce to bring in efficiency in its production process. The company's cost records for the second quarter of the year are given below: Actual quantity of raw materials used per unit Actual cost of raw material per kg Actual time taken to manufacture one unit 3.50 kg 6.50 2.50 hours 8.50 £ 34,125 £31,875 Actual wage rate per hour Actual cost of direct material purchased and used Actual direct wages paid
Transcribed Image Text:Kranberry Networks Ltd had implemented a standard costing system to aid it in assessing the performance of its operations. In the first quarter of the current year, the company had the following variances: Direct materials price variance Direct materials quantity variance Direct labour rate variance Direct labour efficiency variance £1,200 favourable £ 324 unfavourable £3,375 favourable £ 90 unfavourable The following additional information is provided for the first quarter: Actual quantity of raw materials used per unit Actual cost of raw material per kg Actual time taken to manufacture one unit Actual wage rate per hour Actual cost of direct material purchased and used Actual direct wages paid 4.00 kg £ 7.00 3.00 hours £ 8.25 £42,000 £37,125 The company hired a new supervisor in the beginning of the second quarter. Based on the supervisor's inputs, the company replaced faulty machines. The company has reskilled its labour workforce to bring in efficiency in its production process. The company's cost records for the second quarter of the year are given below: Actual quantity of raw materials used per unit Actual cost of raw material per kg Actual time taken to manufacture one unit 3.50 kg 6.50 2.50 hours 8.50 £ 34,125 £31,875 Actual wage rate per hour Actual cost of direct material purchased and used Actual direct wages paid
(b) Direct materials quantity variance Direct materials quantity variance Favourable
Transcribed Image Text:(b) Direct materials quantity variance Direct materials quantity variance Favourable
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