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Mr. Green makes salads. The standard plate of salad has 30 g of lettuce (L), 50 g of peppers
(P) and 80 g of beetroot (B). The standard prices of the three ingredients are $0.2/kg,
0.4/kg and 0.8/kg respectively.
Mr. Green has been experimenting and so in July he changed the mix of vegetables on the
plate thus: 1,500 plates contained 62,000 grams of lettuce, 81,000 grams of peppers and
102,000 grams of beetroot.
What is the total material yield variance?i do this
1500 should have used 160*1500=240000
but they have used 245000variance = -5000
i don’t know what to do nextThe actual total quantity input is 245,000 gm. 62,000 grams of lettuce, 81,000 grams of peppers and 102,000 grams of beetroot.
If it had been mixed in the standard mix it would be
45,937.5 gms of lettuce (30/160 x 245,000);
76,562.5 gms of peppers; and,
122,500 gms of beetroot.
Costing out at standard cost gives a total cost of $137.81For the actual production of 1,500 plates, then at standard mix they should have input:
lettuce 45,000 gms (1,500 x 30);
peppers 75,000 gms;
and beetroot 120,000 gms
Costing out at standard cost gives a total cost of $135.The variance is therefore 137.81 – 135 = $2.81 adverse.
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