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Following are the details of Abbass Industries for the period ended June 30, 2020. Company establish standard on its normal capacity of 120,000 units/hours in a year: Direct Material

  1. Following are the details of Abbass Industries for the period ended June 30, 2020. Company establish standard on its normal capacity of 120,000 units/hours in a year:

Direct Material                      600,000 kgs at Rs. 9 per kg

                        Direct Labor                          4 hours per unit at Rs. 6 per hour

                        Factory overhead:

                                    Fixed cost                  Rs. 240,000 per year or Rs. 20,000 per month.

                                    Variable Cost              Rs. 4.50 per hour.

During the one month of operation, company produced 11,000 units.

                        Direct material used:                      60,500 kgs at Rs. 9.10 per kg

                        Direct labor used:                            41,250 hours at Rs. 268,125

                        Actual variable Factory overhead      Rs. 55,000

Required:

                        Calculate the two variances for material, two variances for labor, and two variances for factory overhead.   

 

May 17 2021 View more View Less

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