A company operates standard costing & Budgetary control system. Following detail

Question

A company operates standard costing & Budgetary control system. Following details are available in respect of a month. Required to calculate necessary sales variance. Product Budget Actual Qty Price Value Qty Price Value A 1000 10 10,000 1200 11 13,200 B 750 20 15,000 700 20 14,000 C 500 30 15,000 600 28 16,800 D 250 40 10,000 200 41 8,200 Total 2500 50,000 2700 52,200 In order to calculate all the sales variances it is necessary to ascertain , a) Standard sales : i.e. actual quantities sold valued at standard selling price. b) Revised standard sales: i.e. standard sales expressed in budgeted sales ratio.

Explanation / Answer

Standard: Quantity Rate Amount A 1,000 10.00 10,000 B 750 20.00 15,000 C 500 30.00 15,000 D 250 40.00 10,000 2,500 50,000 Actual Quantity Rate Amount A 1,200 11.00 13,200 B 700 20.00 14,000 C 600 28.00 16,800 D 200 41.00 8,200 2,700 52,200 A Standard Sales: Actual Quantity Rate Amount A 1,200 10.00 12,000 B 700 20.00 14,000 C 600 30.00 18,000 D 200 40.00 8,000 52,000 B Revised Standard Sales: Standard: Quantity Ratio Actual Sales A 1,000 40.00% 1080 (Total Q*Ratio) B 750 30.00% 810 C 500 20.00% 540 D 250 10.00% 270 2,500 2,700 Sales Volume Variance: Standard Actual Standard: Variance Sales Price Variance A 1,200 1,000 200 10.00 2000 B 700 750 -50 20.00 -1000 C 600 500 100 30.00 3000 D 200 250 -50 40.00 -2000 Favourable 2000 Sales Price Variance: Actual Price Standard Price Difference Actual Unit Sales Price Variance A 11.00 10.00 1.00 1,200 1200 B 20.00 20.00 0.00 700 0 C 28.00 30.00 -2.00 600 -1200 D 41.00 40.00 1.00 200 200 Favourable 200 Sales Mix Variance: Actual Actual Unit at S.Mix Difference Standard Price Sales Mix Variance A 1,200 1080 120.00 10.00 1200 B 700 810 -110.00 20.00 -2200 C 600 540 60.00 30.00 1800 D 200 270 -70.00 40.00 -2800 2700 2700 Adverse -2000

Related Questions

Navigate

• Browse (All)
• Browse A
• Subjects

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.