01. 
From the following information, calculate the variances:
Material 
Standard 

Actual 
Usage kg. 
Rate per kg. 
Total Rs. 
Usage kg. 
Rate per kg. 
Total Rs. 
P 
60 
3 
180 
50 
4 
200 
Q 
40 
7 
280 
35 
6 
210 
Gross Input 
100 

460 
85 

410 
Less: Normal loss 
10 
Less: Actual Loss 
7 

Output 
90 



78 

Solution
[TMCV = + Rs. 11.33 ; TMPV = − Rs. 15; TMUV/TMQV = + Rs. 3.67;
TMMV = − Rs. 4 ; TMYV/TMSUV = + Rs. 7.67;]

02. 
From the following information, calculate the variances:
Material 
Standard 
 Actual 
Tonnes 
Rate 

Tonnes 
Rate 
P 
150 
13 

170 
12 
Q 
80 
8 

55 
9 
Gross Input 
250 


225 

Less:Loss 
25 


18 

Output 
225 


207 

Solution
[TMCV = − Rs. 152.20; TMPV = + Rs. 115; TMUV/TMQV = − Rs. 267.20;
TMMV = −Rs. 319 ; TMYV/TMSUV = −Rs. 51.80;]

03. 
The following are the standard and actual cost details of a product:
Material 
Standard 

Actual 
Quantity kg. 
Rate per kg. 
Amount Rs. 

Quantity kg. 
Rate per kg. 
Amount Rs. 
F 
1,200 
12 
14,400 

1,250 
13 
16,250 
G 
700 
14 
9,800 

740 
15 
11,100 
H 
600 
10 
6,000 

860 
9 
7,740 
Gross Input 
2,500 
12.08 
30,200 

2,850 
15.60 
35,090 
Less:Wastage 
250 
2 
500 

375 
?? 
?? 
Output 
2,250 
13.20 
29,700 

2,475 
?? 
?? 
Solution
[TMCV = − Rs. 1,870; TMPV = − Rs. 1,130;TMUV/TMQV = − Rs. 740;
TMMV = + Rs. 468;TMYV/TMSUV = −Rs. 1,208; ]

04. 
From the following calculate all possible material variances
Material 
Standard Mix 
Actual Mix 
Material A 
90 units costing Rs. 3,600 
450 units costing Rs. 18,900 
Material B 
60 units costing Rs. 1,800 
300 units costing Rs. 10,500 
Standard Loss allowed is 10% of input and standard rate of scrap realisation is Rs. 6 per unit. Actual output is 648 units.
Solution
[TMCV = − Rs. 3,480; TMPV = − Rs. 2,400; TMUV/TMQV = − Rs. 1,080;
TMMV = Nil;TMYV/TMSUV = − Rs. 1,080; ]

05. 
The standard cost of a chemical mixture is as under
250 tons of material M @ Rs. 12,000 per ton
375 tons of material N @ Rs. 14,000 per ton
Standard yield is 80% of input.
Actual cost for a period is as under
255 tons of material M @ Rs. 11,000 per ton
370 tons of material N @ Rs. 15,000 per ton
Actual Yield is 525 tons
Compute Material Variances.
Solution
[TMCV = + Rs. 3,07,500; TMPV = − Rs. 1,15,000; TMUV/TMQV = + Rs. 4,22,500;
TMMV = + Rs. 10,000; TMYV/TMSUV = + Rs. 4,12,500; ]

06. 
124 kgs of Material A at a standard price of Rs. 2 per kg. and 126 kgs of material B at a standard price of Rs. 6 per kg were to be used to manufacture 200 kgs of a chemical.
During a month, 170 kgs of Material A priced at Rs. 2.10 per kg and 150 kgs of Material B priced at Rs. 6.50 per kg were actually used and the output of the chemical was 242 kgs.
Find out the material variances.
Solution
[TMCV = − Rs. 117.16; TMPV = − Rs. 92; TMUV/TMQV = − Rs. 25.16;
TMMV = + Rs. 45.12 ; TMYV/TMSUV = − Rs. 70.28; ]

07. 
The Standard cost of a certain chemical mixture is : 40% material A @ Rs. 2,500 per tonne;
60% material B @ Rs. 4,200 per tonne. A standard loss of 10% is expected in production. During a period of one month 190 tonnes of material A @ Rs. 2,400 per tonne and 310 tonnes of material B @ Rs. 4,350 per tonne were used to produce 414 tonnes of good production.
Calculate all possible material variances.
Solution
[TMCV = − Rs. 1,85,300; TMPV = − Rs. 27,500;TMUV/TMQV = − Rs. 1,57,800;
TMMV = − Rs. 17,000; TMYV/TMSUV = − Rs. 1,40,800; ]

08. 
The standard cost of a certain chemical mixture is:
35% Material A at Rs. 105 per kg.
65% Material B at Rs. 136 per kg.
A standard loss of 5% is expected in production.
During a period there is used:
125 Kg of Material A at Rs. 127 per kg. and
275 kg. of Material B at Rs. 124 per kg.
The actual output was 342 kgs.
Calculate Material Variances.
Solution
[TMCV = − Rs. 4,921; TMPV = + Rs. 550; TMUV/TMQV = − Rs. 5,471;
TMMV = − Rs. 465 ; TMYV/TMSUV = − Rs. 5,006;]

09. 
The standard mix of product is:
X = 75 units at 15 paise per unit
Y = 80 units at 20 paise per unit
Z = 125 units at 20 paise per unit
Ten units of finished product should be obtained from the above mix. During the month of February, ten mixes were completed and the consumption was:
X = 660 units at 20 paise per unit
Y = 975 units at 15 paise per unit
Z = 885 units at 30 paise per unit
Actual output was 85 units.
Calculate Material Variances.
Solution
[TMCV = − Rs. 99.63; TMPV = − Rs. 72.75; TMUV/TMQV = − Rs.26.88;
TMMV = − Rs. 0.75 ; TMYV/TMSUV = − Rs.26.13;]

10. 
Standard Mix of Product YN is:
lbs 
Materials 
Price per lb 
50 
X 
Rs. 24 
20 
Y 
Rs. 20 
30 
Z 
Rs. 40 
The standard loss in production is 10% of input. There is no scrap value. Actual production for a period was 7,290 lbs. of YN from 80 mixes. Actual purchases and consumption of material during the month were:
lbs 
Materials 
Price per lb 
4,160 
X 
Rs. 27.50 
1,680 
Y 
Rs 18.75 
2,560 
Z 
Rs. 42.50 
You are required to calculate and present the following variances:
Solution
[TMCV = − Rs. 27,900; TMPV = − Rs. 18,860; TMUV/TMQV = − Rs. 9,040;
TMMV = − Rs. 640 ; TMYV/TMSUV = − Rs. 8,400; ]

11. 
A company manufactures a particular product the standard direct materials cost of which is Rs.10 per unit. The following information is obtained from the costing records.
Standard Mix 
Material 

Quantity 

Rate 

Amount 

Units 

Rs/unit 

Rs 
A 

70 

10 

700 
B 

30 

15 

450 


100 



1,150 
Loss: (15%) 

15 

– 

– 


85 



1,150 
Actual results for a period: 
Material 

Quantity 

Rate 

Amount 

Units 

Rs/unit 

Rs 
A 

400 

11 

4,400 
B 

200 

16 

3,200 


600 



7,600 
Loss: (10%) 

60 






540 



7,600 
Compute all the material variances
Solution
[TMCV = − Rs. 294.12; TMPV = − Rs. 600; TMUV/TMQV = + Rs. 305.88;
TMMV = − Rs. 100 ; TMYV/TMSUV = + Rs. 405.88; ]

12. 
The standard material inputs required for 1,000 kgs of a finished product are given below:
Material 

Quantity (in Kg.) 

Standard Rate per kg (in Rs.) 
P 

425 

22 
Q 

450 

44 
R 

225 

56 
Gross Input 

1,100 


Less: Standard loss 

100 


Standard output 

1,000 


Actual production in a period was 20,000 kgs. Of the finished product for which the actual quantities of material used and the prices paid thereof are as under:
Material 

Quantity Used (in Kg.) 

Purchase Price per kg (in Rs.) 
P 

9,700 

19 
Q 

8,600 

42 
R 

4,800 

60 
Calculate the material variances.
Solution
[TMCV = + Rs. 1500; TMPV = + Rs. 27,100; TMUV/TMQV = − Rs. 25,600;
TMMV = + Rs. 16,150 ; TMYV/TMSUV = − Rs. 41,750; ]

13.

Gemini Chemical Industries provide the following information from their records:
For making 10 kgs. Of Gemco, the standard material requirement is:
Material 

Quantity Kgs. 

Rate per Kg. Rs. 
A 

8 

8.00 
B 

4 

3.00 
During April 1988, 1,000 kgs. of Gemco were produced. The consumption of material is as under:
Material 

Quantity kgs. 

Rate per Kg. Rs. 
A 

750 

7.50 
B 

510 

3.00 
Calculate all possible material variances
Solution
[TMCV = + Rs. 445; TMPV = + Rs. 375; TMUV/TMQV = + Rs. 70;
TMMV = + Rs. 450 ; TMYV/TMSUV = − Rs. 380; ]

14. 
A tonne of a particular standard of material 'M' is obtained from the following mixture.
330 kg. Material X @ Rs. 12 per kg.
275 kg. Material Y @ Rs. 8 per kg.
495 kg. Material Z @ Rs. 6 per kg.
During a month, 200 tonnes of material 'M' were produced by actually using:
70 tonnes Material X @ Rs. 11/ per kg.
62 tonnes Material Y @ Rs. 9/ per kg.
110 tonnes Material Z @ Rs. 6.40 per kg.
Calculate Material Variances.
How do the Yield, Mix and the Price factors contribute to the variation in the actual cost of chemical D over the standard cost?
Solution
[TMCV = − Rs. 2,06,000; TMPV = − Rs. 36,000; TMUV/TMQV = − Rs. 1,70,000;
TMMV = + Rs. 12,600 ; TMYV/TMSUV = − Rs. 1,82,600; ]

15. 
S.V.Ltd. manufactures BXE by mixing three raw materials. For every batch of 100 kgs Of BXE, 125 kgs of raw materials are used. In February 2004, 56 batches were prepared to produce an output of 5,600 kg of BXE. The standard and actual particulars for February 2004 are as under:
Raw Material 

Standard 

Actual 

Quantity of Raw Materials purchased
Kg. 

Mix
% 

Price Per kg. Rs. 

Mix
% 

Price Per kg. Rs. 

A 

50 

20 

60 

21 

5,000 
B 

30 

10 

20 

8 

2,000 
C 

20 

5 

20 

6 

1,200 
Calculate the material variances
Solution
[TMCV = − Rs. 9,600; TMPV = − Rs. 2,600; TMUV/TMQV = − Rs. 7,000;
TMMV = − Rs. 7,000;TMYV/TMSUV = Nil; ]

16. 
XYZ company manufactures a product ABC by mixing three raw materials. For every 100 kg. of ABC 125 kg.of raw materials are used in April 1990, there was an output of 5,600 kg. of ABC. The standard and actual particulars of April 1990 are as follows:
Materials 
Standard 
Actual 
Mix % 
Price per kg. Rs. 
Mix % 
Price per kg. Rs. 
Raw Material I
Raw Material II
Raw Material III

50
30
20

40
20
10

60
20
20

42
16
12

Calculate all variances.
Solution
[TMCV = − Rs. 19,600; TMPV = − Rs. 5,600; TMUV/TMQV = − Rs. 14,000;
TMMV = − Rs. 14,000;TMYV/TMSUV = Nil; ]

17. 
X Y Ltd., manufactures of Product P, uses a standard cost system, Standard product and cost specifications for 1,000 kg. of product P are as follows:
Ingredients 

Quantity inKg. 

Price per kg. 

Cost Rs. 
A 

800 

2.50 

2,000 
B 

200 

4.00 

800 
C 

200 

1.00 

200 
Input 

1,200 



3,000 
= Rs. 2.50 per kg.

Output 

1,000 



3,000 
= Rs. 3.00 per kg.

Material records indicate:

Consumption in January 
A 
157,000 kg.@ Rs. 2.40 
B 
38,000 kg.@ Rs. 4.40 
C 
36,000 kg.@ Rs. 1.20 
Actual finished production for the month of January is 200,000 kg
Solution
[TMCV = + Rs. 12,800; TMPV = − Rs. 6,700; TMUV/TMQV = + Rs. 19,500;
TMMV = − Rs. 3,000; TMYV/TMSUV = + Rs. 22,500; ]

18. 
A factory is engaged in producing a product using two grades of materials A and B mixed in the ratio of 3:2. The standard price of material A is Rs. 4 per unit and that of B Rs. 3 per unit. Normal loss in production is expected at 10%. Due to shortage of materials it was not possible to use the standard mix. However, normal loss is still expected to be 10%. The actual results were as follows:
Material A 280 gms at Rs. 3.80 Material B 120 gms at Rs. 3.60 

Actual production was 369 gms 
you are required to calculate all possible material variances.
Solution
[TMCV = − Rs. 20; TMPV = − Rs. 16; TMUV/TMQV = − Rs. 4;
TMMV = − Rs. 40;TMYV/TMSUV = + Rs. 36; ]

19. 
A particular alloy is produced by using two types of material viz. S and B in the ratio 2:1. During processing a loss of 5% occurs. Standard material prices are:
S  Rs. 1,800 per tonne
B  Rs. 1,200 per tonne
During a particular period, for an output of 500 tonnes of Alloy, the actual consumption was:
S  350 tonnes @ Rs. 2,000 per tonne
B  193 tonnes @ Rs. 1,100 per tonne
You are required to calculate all possible material variances.
Solution
[TMCV = − Rs. 70,194.73; TMPV = − Rs. 50,700; TMUV/TMQV = − Rs. 19,494.73;
TMMV = + Rs. 7,200; TMYV/TMSUV = − Rs. 26,694.73; ]

