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    Mandy LTD

    Uploaded by

    Mohammed Tawfiq
    The document contains a variance analysis for Mandy Ltd. It includes variances for material price and usage, labour rate and efficiency, sales price and volume, variable overhead rate and efficiency, fixed overhead expenditure and volume. In total there was a £35,625 favorable variance between the standard projected profit of £248,683.75 and the actual profit of £372,175.

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    © All Rights Reserved
    Download as XLSX, PDF, TXT or read online from Scribd

    Mandy LTD

    Uploaded by

    Mohammed Tawfiq
    20 views5 pages
    The document contains a variance analysis for Mandy Ltd. It includes variances for material price and usage, labour rate and efficiency, sales price and volume, variable overhead rate and efficiency, fixed overhead expenditure and volume. In total there was a £35,625 favorable variance between the standard projected profit of £248,683.75 and the actual profit of £372,175.

    Original Description:

    Management Accounting - Assignment

    Original Title

    MANDY LTD

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    The document contains a variance analysis for Mandy Ltd. It includes variances for material price and usage, labour rate and efficiency, sales price and volume, variable overhead rate and efficiency, fixed overhead expenditure and volume. In total there was a £35,625 favorable variance between the standard projected profit of £248,683.75 and the actual profit of £372,175.

    Copyright:

    © All Rights Reserved
    Download as XLSX, PDF, TXT or read online from Scribd
    Download as xlsx, pdf, or txt
    20 views5 pages

    Mandy LTD

    Uploaded by

    Mohammed Tawfiq
    The document contains a variance analysis for Mandy Ltd. It includes variances for material price and usage, labour rate and efficiency, sales price and volume, variable overhead rate and efficiency, fixed overhead expenditure and volume. In total there was a £35,625 favorable variance between the standard projected profit of £248,683.75 and the actual profit of £372,175.

    Copyright:

    © All Rights Reserved
    Download as XLSX, PDF, TXT or read online from Scribd
    Download as xlsx, pdf, or txt
    of 5

    STUDENT ID:

    INDEX:

    MANDY LTD
    A) Material Price Variance (MPV)
    = Standard Price - Actual Price × Actual Qty
    = 2.10 × 70,000 – 150,000
    = 147,000 – 150,000
    = £ 3,000(A)
    B) Material Usage Variance
    = Standard Usage (AQ) - Actual Usage × Standard Price
    = 0.75 (95,000) – 70,000 x 2.10
    = (71,250 – 70,000) x 2.10
    = 1250 x 2.10
    = 2625(F)
    C) Labour Rate Variance
    = Standard Rate – Actual Rate x Actual Hours
    = 10.50 x 77,400 – 754,650
    = 812,700 – 754,650
    = £ 58,050(F)
    D) Labour Efficiency Variance
    = Standard Hours (Actual Output) – Actual hours x Standard Rate
    = 0.75(95,000) – 77,400 x 10.50
    = 71,250 – 77,400 x 10.50
    = -6160 x 10.50
    = 64,575(A)
    E) Sales Price Variance
    = Standard Price – Actual Price x Actual Qty Sold
    = 23.50 x 95,000 – 2,409,925
    = 2,232,500 – 2,409,925
    = £ 177,425(A)
    F) Sales Volume Variance
    = Budgeted Qty – Actual Qty x Standard Profit
    = 102,550 – 95,000 x 2.425
    = 7,550 x 2.425
    = £18,308.75(A)
    G) Variable Overhead Rate Variance
    = Standard Rate – Actual Rate x Actual Hours
    = 7.50 – 562,500/77,400 x 77,400
    = £ 18,000(A)
    H) Variable Overhead Efficiency Variance
    = Standard Hours – Actual Hours x Standard Rate
    = 0.75 x 95,000 – 77,400 x 7.50
    = -6,150 x 7.50
    = £ 46,125(A)
    I) Fixed Overhead Expenditure Variance
    = Standard Cost – Actual Cost
    = 6 x 102550 – 570,600
    = 615300 – 570,600
    = £ 44,700(F)
    J) Fixed Overhead Volume Variance
    =0.75 x 102,550 – 0.75 x 95000 x 8
    = 76912.5 – 71250 x 8
    = £ 45,300(A)
    TOTAL COST VARIANCE
    = Standard Cost (Actual Output – Actual Cost)
    = 0.75 x 2.10 x 95,000 – 150,000
    = 149,625 – 150,000
    = £ 375(A)

    CALCULATION FOR STANDARD PROFIT


    Selling Price
    23.50
    Less Cost:
    Material (0.75x2.10) 1.575
    Labour (0.75x10.50) 7.875
    O/H (0.75x7.50) 5.625
    F/O (0.75x8.00) 6.00

    (21.075)
    Profit 2.425

    RECONCILLATION FOR ALL VARIANCE
    £
    Budgeted profit (2.425 x 102,550) 248,683.75
    Sales price variance 177,425
    Sales volume variance 18,308.75               159,116.25

    Fav               Adv
    Cost variance - 3000 -
    Material price variance 2,625
    Material Usage Variance 58,050 -
    Labour Efficiency Variance - 64,575 -
    Variable O/H Rate Variance 18,000
    Variable O/H Efficiency Variance - 46,125
    Fixed O/H Exp Variance 44,700 -
    Fixed O/H Volume Variance        -      45,300
    123,375 159,000
    Actual Profit
    £
    248,683.75

    308.75               159,116.25
    407,800.00
    (35,625)
    372175.00

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