Turnover and Value added

jmh

Hello,

Can someone help with this please:

Value added per employee 46000
Cost of material used 1788000
Cost of bought in services 432000

if business has 20 employees calculate the total turnover
if 8000 units were produced calculate the value added per unit produced

thank you

Cheesypeesy

Total value added = total turnover - total costs.

(46,000 *20) = Total turnover - 1,788,000 - 432,000.

Rearrange to get total turnover = £3,140,000.

Value per unit produced = total value/number of units.

(46,000 * 20)/8000 = £115.00

jmh

thank you!

Can you please help me with something else.

The product requires 3 hours of labour at a cost of £15 per hour.During the month the company used 1,500 labour hours to produce 450 units and the labour rate variance was £420 favourable.
Calculate the actual labour rate per hour. £

thank you

Cheesypeesy

Labour rate variance = (standard price per hour * actual hours at actual production) - (actual price per hour * actual hours at actual production).

I'll denote actual price per hour as X.

£420.00 = (£15.00 * 1500) - (X * 1500)
£420 = £22,500 - 1500X
X = £22,080/1500 = £14.72

jmh

thank you. I honestly don't think I will ever be able to get my head around those Variances. Surely this is not difficult, must be having mental blockage with this.