Financial performance

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Hello everyone, could someone help me with a quick question.

A company used 11,000 kilograms of materials at a cost of £47,300. The production was 1,200 units, for which the standard usage is 10, 800 kilograms of materials at a total standard cost of £43,200. The material usage is?

Thank you :001_smile:

jojo1979

Hiya.

Im not sure if this is right but i have just worked it out as £800

Std is 10800 kgs
Actual 11000kgs

difference is 200kgs x the std price per kg gives you £800.

I hope this is right

Jo

uknitty

I also get 800. I always walk through these questions the "long way" to make sure I am picking up the right figures. This is the answer I came up with:

Usage is based on Standard costs

Standard cost per unit is 43200/10800 = 4

(Standard Usage * Standard Costs) - (Actual Usage * Standard Costs)

(4*10,800)- (4*11,000)

43200 - 44000 = 800