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Pilot Exam paper: Question 2: Simply Soup
Please could any one explain how Standard mix for mixed vegetables $ 91712.20 is calculated.
Thanks
RACFor the mix variance, you take the actual total input (purchases) and compare the way it was actually mixed with the standard way of mixing it.
From the cost card in the question, the total number of litres input is 0.9 (veg) + 0.05 (butter) + 1.10 (stock) = 2.05 litres, and of this total, 0.9 litres is vegetables.
The actual total input is 82000 (veg) + 4,900 (butter) + 122,000 (stock) = 208,900 litres. If that total had been mixed properly, the 0.9 out of every 2.05 would be vegetables. So the vegetables should have been 0.9/2.05 = 208,900 = 91712.20 Litres (not $’s!!)
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