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Hi again!
This might be the final question i need help on as my exam is on Tuesday!
Its from the ACCA website and the question is: Production was X units than budgeted. What is X?
Information given is
Standard cost card
Selling price – $150
Direct materials 2 kg @ $25/kg – $50
Direct labour 3 hours @ $10 per hour – $30
Fixed overhead 2 hours at $10 per hour – $20
Profit – $50Operating System:
Budgeted profit $600,000
Sales volume variance $60,000 adv
Standard profit on actual sales $540,000
Sales price variance $20,000 fav
$560,000
Production cost variances
Material price $7,500 (F)
Material usage $8,000 (A)
Labour rate $2,000 (A)
Labour efficiency $500 (F)
Fixed overhead expenditure $7,000 (A)
Fixed overhead volume $2,000 (A)Actual profit $549,000
I have worked out budgeted sales to be 12,000 units. I think actually sold is 10,800.
Yes – budgeted sales are $600,000 / $50 = 12,000 units.
And yes, since the sales volume variance is 60,000 (adv) they actually sold 60,000 / 50 = 1,200 less then budget, which is 10,800.
Good luck in your exam 🙂
Hi Sir
Just thought I say thank you for your help. I managed to pass my F2 paper with a mark of 88%. Now onto F3!!!
Mandip
That is great news – 88% is a really good mark 🙂
Many congratulations!
Thank you for letting us know, and best of luck with Paper F3.
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