Sami Un Bashir-1831301630

Variance analysis
Standard rate:
1 kg. of Raw material per cake at 500 taka per kg.

Total standard amount of raw material required:

1st quarter: 423 kg
2nd. quarter: 366 kg
3rd quarter: 426 kg
4th quarter: 474 kg

Total cost of raw materials (according to standard values):

1st quarter: 211500 taka

2nd. quarter: 183000 taka
3rd quarter: 213000 taka
4th quarter: 237000 taka

Actual cost of the RM

1st quarter: 510taka/kg

2nd. quarter: 480 taka /kg
3rd quarter: 490 taka/kg
4th quarter: 500 taka/kg

Purchased Amount:
1st quarter: 424kg
2nd. quarter: 378 kg
3rd quarter: 427 kg
4th quarter: 489 kg

On the first quarter:

SQ = 423 kg,
SP= 500 taka/kg
AQ = 424 kg
AP =510 taka/kg
Material Price variance = (AQ*AP) - (AQ*SP) = (424*510) – (424*500) = 4240 taka
(Unfavorable)
Material Quantity variance = (AQ*SP) - (SQ*SP) = (424*500) - (423*500) = 500 taka
(Unfavorable)

On the Second quarter:

SQ = 366 kg
SP= 500 taka/kg
AQ = 378 kg
AP = 480 taka/kg

Material Price variance = (AQ*AP) - (AQ*SP) = (378*480) – (378*500) = -7560 taka

(favorable)

Material Quantity variance = (AQ*SP) - (SQ*SP) = (378*500) - (366*500) = 6000 taka

(Unfavorable)

On the third quarter:

SQ = 426 kg
SP= 500 taka/kg
AQ = 427 kg
AP = 490 taka/kg

Material Price variance = (AQ*AP) - (AQ*SP) = (427*490) – (427*500) = - 4270 taka

(favorable)

Material Quantity variance = (AQ*SP) - (SQ*SP) = (427*500) - (426*500) = 500 taka

(Unfavorable)

On the fourth quarter:

SQ = 474 kg
SP= 500 taka/kg
AQ = 489 kg
AP = 500 taka/kg

Material Price variance = (AQ*AP) - (AQ*SP) = (489*500) – (489*500) = 0 taka

Material Quantity variance = (AQ*SP) - (SQ*SP) = (489*500) - (474*500) = 7500 taka
(Unfavorable)