F2 - Management Accounting ACCA Tutorial Questions Chapter 22: Further Variance Analysis 1
Question 1 Suppose that the standard selling price of product X is $15. Actual sales in 2011 were 2,000 units at $15.30 per unit. Calculate the selling price variance. Question 2 Suppose that a company budgets to sell 8,000 units of product J for $12 per unit. The standard full cost per unit is $7. Actual sales were 7,700 units, at $12.50 per unit. Calculate the sales volume profit variance. Question 3 A company uses standard marginal costing. Last month the standard contribution on actual sales was $10,000 and the following variances arose. Total variable cost variance Sales price variance Sales volume contribution variance What was the actual contribution for last month? $2,000 (A) 500 (F) 1,000 (A) Question 4 XYZ uses standard costing. The following data relates to labour grade II. Actual hours worked 10,400 hours Standard allowance for actual production 8,320 hours Standard rate per hour $5 Rate variance (adverse) $416 What was the actual rate of pay per hour? 2
Question 5 A company manufactures a single product. An extract from variance control report together with relevant standard cost data is shown below. Standard selling price per unit $75 Standard direct material cost (4kg x $3 per kg) $12 Budgeted total material cost of sales $2,400 per month Budgeted profit margin $6,950 per month Actual results for February Sales revenue $15,500 Total direct material cost $2,500 Direct material price variance $900 (A) Direct material usage variance $500 (F) There was no change in inventory levels during the month. a) What was the actual production in February? b) What was the actual usage of direct material during February? c) What was the selling price variance for February? d) What was the sales volume variance for February? Question 6 The following data relates to one of a company s products. $ per unit $ per unit Selling price 30 Variable cost 15 Fixed cost 7 22 Profit 8 Budgeted sales for control period 7 were 2,500 units, but actual sales were 2,650 units. The revenue earned from these sales was $68,350. 3
Profit reconciliation statements are drawn up using marginal costing principles. What sales variances would be included in such statement for period 7? a) Sales price variance b) Sales volume variance Question 6 A company uses a standard absorption costing system. Last month budgeted production was 8,500 units and the standard fixed production OH cost was $16 per unit. Actual production last month was 8,600 units and the actual fixed production OH cost was $18 per unit. What was the total adverse fixed production OH variance for last month? Question 7 A company uses standard marginal costing. Last month the standard contribution on actual sales was $11,000 and the following variances arose: Total variable cost variance Sales price variance Sales volume contribution variance What was the actual contribution for last month? $ 2,500 (A) 600 (F) 1,100 (A) 4
Question 8 A company produces and sells one type of product. The details for last year were as follows: Production & Sales Budgeted Actual Production (unit) 27,000 27,000 Sales (units) 29,000 26,000 There was no inventory at the start of the year. Selling price and costs Budget Actual $ $ Selling price per unit 85 85 Variable cost per unit 65 65 Fixed production OH 145,000 114,000 Fixed selling costs 70,000 70,000 a) Calculate the actual profit for the year that would be reported using marginal costing. b) Calculate the actual profit for the year that would be reported using absorption costing. 5