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Dear sir
In part c they asked to calculate total cost planning and operation varainace .I have a doubt in calculating the planning variance
Revised cost @act prod =24000
60000cakes * 0.40 per cake
Std cost @actual price = 18120
0.302 * 60000In question std cost per kg was 3.02 per kg why should we use 0.302 as a std cost not 3.02 .
Thanks in advanceThe standard cost from the question is not 3.02 per cake.
It is (0.1 x 0.12) + (0.1 x 0.70) + (0.1 x 1.70) + (0.1 x 0.50) = $0.302.
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