MABU Sample Assessment 1 Q1.6
Shortages
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1.6 (B)
The operating statement for October showed that direct raw material costs were £142,560.
9900KG of material were used and 6000 items were made and sold.
The standard cost allows 1.6 Kilograms (KG) of material for each item at a standard price of £14.50 per KG.
(b) Complete the table of direct raw material costs, indicating whether each variance is favorable or adverse.
Direct raw material costs
Flexed Budget (standard cost) £
Actual material price per kg (correct to 0.01) £
Actual Material used per item (correct to two decimal places) KG
Price Variance £
Usage Variance £
Cost Variance £
Cost variance percentage (correct to one decimal place) %
I will post question C in an additional comment as I am sure I will run out of space.
Thanks again!
0 
(c) Prepare the direct labour cost statement from the activity data provided.
Round to the nearest whole number if necessary.
Activity Data Items Labour Hrs Cost £
Budget 18,300 3,660 65,880
Actual Results 18,800 4,700 82,720
Direct Labour cost of production
Standard labour cost of production £
Variances £ Fav/Adv
Labour Rate
Labour Efficiency
Labour Cost
Thank you0 
1.6 (B)
The operating statement for October showed that direct raw material costs were £142,560.
9900KG of material were used and 6000 items were made and sold.
The standard cost allows 1.6 Kilograms (KG) of material for each item at a standard price of £14.50 per KG.
(b) Complete the table of direct raw material costs, indicating whether each variance is favorable or adverse.
Direct raw material costs
Flexed Budget (standard cost) £
Actual material price per kg (correct to 0.01) £
Actual Material used per item (correct to two decimal places) KG
Price Variance £
Usage Variance £
Cost Variance £
Cost variance percentage (correct to one decimal place) %
I hope this makes sense, I can send you a link to the exam also if that helps.
http://www.aatinteractive.org.uk/elearning/Sample_assessments_AQ2016/AQ2016_L4_MABU_Sample_1/index.html
There is also a part C which I will post in an additional comment.
Thanks again!0 
It is better to start the solution from Price, usage and cost variance. As you can see below:
Price Variance: 9900*14.50=143,550  142560= 990 F
Usage Variance: 6000*1.6*14.50=139200143550= 4350
Cost Variance= 990 + 4350= 3360
Flexed budget= 142560 3360(3360 is from the cost variance) and the answer: 139,200
Actual material price per kg (correct to 0.01) £142,560/9900=14.40
Actual Material used per item (correct to two decimal places) KG:9900/6000=1.651
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