QUESTION 2 PART A Soo Seng Engineering Sdn Bhd manufactures outboard motors for motor boats. The company uses a standard

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Question 2 Part A Soo Seng Engineering Sdn Bhd Manufactures Outboard Motors For Motor Boats The Company Uses A Standard 1 (241.01 KiB) Viewed 29 times

QUESTION 2 PART A Soo Seng Engineering Sdn Bhd manufactures outboard motors for motor boats. The company uses a standard cost system for its production and control. The standard cost for the outboard motors is as follows: The company's budgeted production is 60,000 units. Standard overhead rates are computed based on the budgeted units and measured in standard direct labour hours where applicable. Direct materials (6.0 Ibs @ RM 5.00) Direct labor (1.6 hours @ RM 12.00) Variable manufacturing overhead (1.6 hours @ RM 10.00) Fixed manufacturing overhead (1.6 hours @ RM 6.00) Standard Unit Cost RM 30.00 19.20 16.00 9.60 74.80 During the year 2021, Soo Seng Engineering Sdn Bhd had the following actual production activity: i. Production of outboard motors totaled 50,000 units. ii. The company used 325,000lb of direct materials at the cost of RM1,664,000. iii. The company used 82,000 direct labour hours at a total cost of RM1,066,000. iv. Actual fixed overhead totaled RM556,000. V. Actual variable manufacturing overhead totaled RM860,000. Required: a) Prepare a flexible budget performance report comparing the flexible budget with the actual production and cost. (4 marks) b) Compute the variable manufacturing overhead spending variance. (1 mark) c) Compute the variable manufacturing overhead efficiency variance. (2 marks) d) Compute the fixed manufacturing overhead spending variance. (1 mark) e) Compute the fixed manufacturing overhead volume variance. (2 marks)