Pev dec 09

flower

Task 1.1 (c) Statemen of Reconcilliation
Can anyone help. Not able to find where the figures are coming from
in Working 1 i.e. 23,500 x 9500/10000. Unsure on the 23,500
Any help appreciated.

crispy

Hello,

The £23,500 comes from the standard cost of the budgeted production:

Eg. Total Standard Material cost for 1kg pack = £ 2.35 (1.50 + 0.75 + 0.10)
budgeted Production = 10,000 packs

10,000 X £ 2.35 = £ 23,500


The standard cost of materials for actual production would be 9,500 * £ 2.35 = £ 22,325

HTH

flower

Thank you so much.

flower

Sorry, still struggling to see where the 2.35 comes from. Think it is the way figures set out. Thought I was getting to grips with these variances.

crispy

Have a look at the standard cost card:

Materials (A Beans) 1.50
Materials (B Beans) 0.75
Packing (Foil) 0.10

= £2.35 Standard Material Cost for 1kg of coffee

flower

Of Course. Think I spent too much time staring at the question. Thanks again.