- November 15, 2015 at 5:07 pm #282585samara182Member
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- Replies: 6
Runswick Fisheries catch and process crabs. There are 4 employees processing and dressing the crabs. Time allowed to dress and prepare a crab is 3 standard minutes. Each employee works a standard 35 hour week, although overtime is often worked. The standard labour rate per hour is $6.20.
Standard material cost per crab is $1.30 but not all crabs processed meet quality standards as wastage occurs.
The budgeted fixed cost for the month is $3750. For the month August 20×1 its budgeted output was 12000 dressed crabs or 3000 units per week.
During the week ending 18/8/20X1:
– 3050 crabs were dressed satisfactorily, but 3110 were used
– actual cost of crabs was $4354
– actual hours worked were 162
– actual cost of labour $1021
– fixed overheads incurred were $990
Calculate variances for the week ending 18/8/20×1 (4 weeks in a month)
I have several questions:
a) for budgeted hours: is it 3000 (budgeted output) x 3min/60min = 150 h
b) what do we take for standard and actual quantity when calculating direct material variance? do we take 3050 as the actual quantity and 3110 as standard or vice versa?
c) which quantity do we use to calculate standard hours? 3050?
d) for budgeted expenditure: the question says that the budgeted fixed cost for the month is $3750. Since we have to calculate the figures only for one week, do we divide 3750/4 or du we use the full amount to calculate OAR?
Thank you in advance for your helpNovember 15, 2015 at 6:06 pm #282607John MoffatKeymaster
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I am sorry but we cannot provide full answers to questions that you have found elsewhere.
You must have an answer is the same book in which you found the question (unless this is a test that you have been set as homework – we are not here to provide answers to homework 🙂 )
Please ask what problem you are having with the answer in your book and then I will try to help you.
Also, if you watch our free lectures then all of this is covered. Our lectures are a complete course for Paper F2 and cover everything you need to be able to pass the exam well.
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