Solution Exhibit B Columnar presentation of direct materials-yield and mix-variances for Markku Antero. (Actual total quantity of all inputs used × Actual input mix) × Budgeted prices (€) (1) (Actual total quantity of all inputs used × Budgeted input mix) × Budgeted prices (€) (2) Flexible budget (Budgeted total quantity of all inputs allowed for actual output achieved × Budgeted input mix) × Budgeted prices (€) (3) Tartarus 100,000 × ab Erebus 100,000 % c % 3.50 = 122,500 (100,000 % d) % 3.50 = 105,000 (93,750 % 0.3) % 3.50 = 98,437.50 Uranus 100,000 % e % 2.50 = 50,000 (100,000 % f) % 2.50 = 75,000 (93,750 % 0.3) % 2.50 = 70,312.50 All Fluids €442,500 €420,000 €393,750.00 U U Total mix variance Total yield variance ↑ €48,750 U ↑ Total efficiency variance F = favourable effect on operating income U = unfavourable effect on operating income. Actual input mix Budgeted input mix aTartarus = 45,000 ÷ 100,000 = 45% bTartarus = 40 ÷ 100 = 40% cErebus = 35,000 ÷ 100,000 = 35% dErebus = 30 ÷ 100 = 30% eUranus = 20,000 ÷ 100,000 = 20% f Uranus = 30 ÷ 100 = 30%
Bhimani, Horngren, Datar and Rajan, Management and Cost Accounting, 5 th Edition, Instructor’s Manual © Pearson Education Limited 2012 17.18 Direct materials price and efficiency variances, direct materials yield and mix Share with your friends: |