# Two or More Materials :: Revision of Standards

 Problems » Solutions
01. From the following information, calculate the material variances.
Materials Standard Actual
A 200 units @ Rs.12 160 units @ Rs.13
B 100 units @ Rs.10 140 units @ Rs.10
Due to shortage of material A, it was decided to reduce consumption of A by 15% and increase that of material B by 30%.

Solution

02. From the following information calculate the Material Variances:
Materials

Standard
Quantity
Actual
Quantity
Standard
price per unit Rs.
Actual
price per unit Rs.
A 100 150 5 5.50
B 200 250 6 6.00
C 300 400 4 3.50
Due to shortage of B, it was decided to reduce consumption of B by 20 units and increase that of A and C by 15 units and 5 units respectively.

Solution

03. S.V.Ltd. manufactures a simple product, the standard mix of which is:
 Material A 60% at Rs.20 per kg. Material B 40% at Rs.10 per kg.

Normal loss in production is 20% of input. Due to shortage of Material A, the standard mix was changed. Actual results for March, 1989 were:

 Material A 105 kgs at Rs. 20 per kg. Material B 95 kgs at Rs. 9 per kg. Input 200 kgs Loss 35 kgs Output 165 kgs
Calculate all possible material variances.

Solution

04. For producing 100 units of 'Avlon', 40 units of 'CEROM', and 60 units of 'DEVON' are to be mixed.
Actually 1,000 units of 'Avlon' were produced, but the standard mix was changed (due to shortage of material 'CEROM') to 30 units of 'CEROM' and 70 units of 'DEVON' for production of 100 units.
The actual number of units used were 320 units of 'CEROM' and 750 units of 'DEVON'.
The standard cost per unit of materials 'CEROM' was Rs. 10 and of material 'DEVON' Rs. 8.00 whereas the actual cost of 'CEROM' and 'DEVON' is Rs. 11 and Rs. 9.00 per unit respectively.
Calculate the various variances that emerge.

Solution

05. Bharat Metal Works manufactures a single product, the standard mix of which is:
Material X 60% @ Rs. 20
Material Y 40% @ Rs. 10
Normal loss in production is 20 per cent of input. Due to shortage of Material X, the standard mix was changed. Actual results for January were:
Rs.
Material X = 210 kg @ Rs. 20 4,200
Material Y = 190 kg @ Rs. 19 1,710
Input 400 kg   5,910
Loss 72 kg
Output 328 kg   5,910

Calculate material variances.

Solution

06. Standard Products (Private) Ltd. Produces a single product, requiring 2 Kg. of materials per unit in the following ratio:
M - 60% @ Rs.10/- per kg.
P - 40% @ Rs.5/- per kg.
To this 10% normal loss is added to arrive at input.

During a particular period, on account of shortage of P, the mix was changed and the actual results were as follows for an output of 250 units.
 M 378 kg @ 10/- per kg. Rs. 3,780.00 P 162 kg @ 6/- per kg. Rs. 972.00 Input 540 kg. Rs. 4,752.00 Loss 36 kg. – 504 kg. Rs. 4,752.00
Calculate all the variances.

Solution

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