From the following information, calculate the variances:

Material	Standard				Actual
	Usage kg.	Rate per kg.	Total		Usage kg.	Rate per kg.	Total
P	60	3	180		50	4	200
Q	40	7	280		35	6	210
Gross Input	100		460		85		410
Less: Normal loss	10	Less: Actual Loss			7
Output	90				78

Solution [TMCV = + 11.33 ; TMPV = − 15; TMUV/TMQV = + 3.67; TMMV = − 4 ; TMYV/TMSUV = + 7.67;]

From the following information, calculate the variances:

Material	Standard			Actual
	Tonnes	Rate		Tonnes	Rate
P	150	13		170	12
Q	80	8		55	9
Gross Input	250			225
Less:Loss	25			18
Output	225			207

Solution
[TMCV = − 152.20; TMPV = + 115; TMUV/TMQV = − 267.20; TMMV = − 319 ;
TMYV/TMSUV = − 51.80;]

The following are the standard and actual cost details of a product:

Material	Standard				Actual
	Quantity kg.	Rate per kg.	Amount		Quantity kg.	Rate per kg.	Amount
F	1,200	12	14,400		1,250	13	16,250
G	700	14	9,800		740	15	11,100
H	600	10	6,000		860	9	7,740
Gross Input	2,500	12.08	30,200		2,850	15.60	35,090
Less:Wastage	250	2	500		375	??	??
Output	2,250	13.20	29,700		2,475	??	??

Solution
[TMCV = − 1,870; TMPV = − 1,130;TMUV/TMQV = − 740; TMMV = + 468;TMYV/TMSUV = − 1,208; ]

From the following calculate all possible material variances

Material	Standard Mix	Actual Mix
Material A	90 units costing 3,600	450 units costing 18,900
Material B	60 units costing 1,800	300 units costing 10,500

Standard Loss allowed is 10% of input and standard rate of scrap realisation is 6 per unit. Actual output is 648 units.

Solution
[TMCV = − 3,480; TMPV = − 2,400; TMUV/TMQV = − 1,080; TMMV = Nil;TMYV/TMSUV = − 1,080; ]

The standard cost of a chemical mixture is as under

250 tons of material M @ 12,000 per ton
375 tons of material N @ 14,000 per ton

Standard yield is 80% of input.

Actual cost for a period is as under

255 tons of material M @ 11,000 per ton
370 tons of material N @ 15,000 per ton

Actual Yield is 525 tons
Compute Material Variances.

Solution
[TMCV = + 3,07,500; TMPV = − 1,15,000; TMUV/TMQV = + 4,22,500; TMMV = + 10,000;
TMYV/TMSUV = + 4,12,500; ]

124 kgs of Material A at a standard price of 2 per kg. and 126 kgs of material B at a standard price of 6 per kg were to be used to manufacture 200 kgs of a chemical.

During a month, 170 kgs of Material A priced at 2.10 per kg and 150 kgs of Material B priced at 6.50 per kg were actually used and the output of the chemical was 242 kgs.

Find out the material variances.

Solution
[TMCV = − 117.16; TMPV = − 92; TMUV/TMQV = − 25.16; TMMV = + 45.12 ;
TMYV/TMSUV = − 70.28; ]

The Standard cost of a certain chemical mixture is : 40% material A @ 2,500 per tonne; 60% material B @ 4,200 per tonne. A standard loss of 10% is expected in production. During a period of one month 190 tonnes of material A @ 2,400 per tonne and 310 tonnes of material B @ 4,350 per tonne were used to produce 414 tonnes of good production
Calculate all possible material variances.

Solution
[TMCV = − 1,85,300; TMPV = − 27,500;TMUV/TMQV = − 1,57,800; TMMV = − 17,000;
TMYV/TMSUV = − 1,40,800; ]

The standard cost of a certain chemical mixture is:

35% Material A at 105 per kg
65% Material B at 136 per kg.

A standard loss of 5% is expected in production.

During a period there is used:

125 Kg of Material A at 127 per kg. and
275 kg. of Material B at 124 per kg.

The actual output was 342 kgs
Calculate Material Variances.

Solution
[TMCV = − 4,921; TMPV = + 550; TMUV/TMQV = − 5,471; TMMV = − 465 ;
TMYV/TMSUV = − 5,006;]

The standard mix of product is:

X = 75 units at 15 paise per unit
Y = 80 units at 20 paise per unit
Z = 125 units at 20 paise per unit

Ten units of finished product should be obtained from the above mix. During the month of February, ten mixes were completed and the consumption was:

X = 660 units at 20 paise per unit
Y = 975 units at 15 paise per unit
Z = 885 units at 30 paise per unit

Actual output was 85 units
Calculate Material Variances.

Solution
[TMCV = − 99.63; TMPV = − 72.75; TMUV/TMQV = − 26.88; TMMV = − 0.75 ;
TMYV/TMSUV = − 26.13;]

Standard Mix of Product YN is:

lbs	Materials	Price per lb
50	X	24
20	Y	20
30	Z	40

The standard loss in production is 10% of input. There is no scrap value. Actual production for a period was 7,290 lbs. of YN from 80 mixes. Actual purchases and consumption of material during the month were:

lbs	Materials	Price per lb
4,160	X	27.50
1,680	Y	18.75
2,560	Z	42.50

You are required to calculate and present the following variances:

Solution
[TMCV = − 27,900; TMPV = − 18,860; TMUV/TMQV = − 9,040; TMMV = − 640 ;
TMYV/TMSUV = − 8,400; ]

A company manufactures a particular product the standard direct materials cost of which is 10 per unit. The following information is obtained from the costing records.

Standard Mix
Material		Quantity		Rate		Amount
		Units		/unit
A		70		10		700
B		30		15		450
		100				1,150
Loss: (15%)		15		–		–
		85				1,150

Actual results for a period:
Material		Quantity		Rate		Amount
		Units		/unit
A		400		11		4,400
B		200		16		3,200
		600				7,600
Loss: (10%)		60
		540				7,600

Compute all the material variances

Solution
[TMCV = − 294.12; TMPV = − 600; TMUV/TMQV = + 305.88; TMMV = − 100 ;
TMYV/TMSUV = + 405.88; ]

The standard material inputs required for 1,000 kgs of a finished product are given below:

Material		Quantity (in Kg.)		Standard Rate per kg (in )
P		425		22
Q		450		44
R		225		56
Gross Input		1,100
Less: Standard loss		100
Standard output		1,000

Actual production in a period was 20,000 kgs. Of the finished product for which the actual quantities of material used and the prices paid thereof are as under:

Material		Quantity Used (in Kg.)		Purchase Price per kg (in )
P		9,700		19
Q		8,600		42
R		4,800		60

Calculate the material variances.

Solution
[TMCV = + 1500; TMPV = + 27,100; TMUV/TMQV = − 25,600; TMMV = + 16,150 ;
TMYV/TMSUV = − 41,750; ]

Gemini Chemical Industries provide the following information from their records:
For making 10 kgs. Of Gemco, the standard material requirement is:

Material		Quantity Kgs.		Rate per Kg
A		8		8.00
B		4		3.00

During April 1988, 1,000 kgs. of Gemco were produced. The consumption of material is as under:

Material		Quantity kgs.		Rate per Kg
A		750		7.50
B		510		3.00

Calculate all possible material variances

Solution
[TMCV = + 445; TMPV = + 375; TMUV/TMQV = + 70; TMMV = + 450 ; TMYV/TMSUV = − 380; ]

A tonne of a particular standard of material 'M' is obtained from the following mixture.

330 kg. Material X @ 12 per kg
275 kg. Material Y @ 8 per kg
495 kg. Material Z @ 6 per kg

During a month, 200 tonnes of material 'M' were produced by actually using:

70 tonnes Material X @ 11/- per kg
62 tonnes Material Y @ 9/- per kg
110 tonnes Material Z @ 6.40 per kg.

Calculate Material Variances
How do the Yield, Mix and the Price factors contribute to the variation in the actual cost of chemical D over the standard cost?

Solution
[TMCV = − 2,06,000; TMPV = − 36,000; TMUV/TMQV = − 1,70,000; TMMV = + 12,600 ;
TMYV/TMSUV = − 1,82,600; ]

S.V.Ltd. manufactures BXE by mixing three raw materials. For every batch of 100 kgs Of BXE, 125 kgs of raw materials are used. In February 2004, 56 batches were prepared to produce an output of 5,600 kg of BXE. The standard and actual particulars for February 2004 are as under:

Raw Material		Standard				Actual				Quantity of Raw Materials purchased Kg.
		Mix %		Price Per kg		Mix %		Price Per kg
A		50		20		60		21		5,000
B		30		10		20		8		2,000
C		20		5		20		6		1,200

Calculate the material variances

Solution
[TMCV = − 9,600; TMPV = − 2,600; TMUV/TMQV = − 7,000; TMMV = − 7,000;TMYV/TMSUV = Nil; ]

XYZ company manufactures a product ABC by mixing three raw materials. For every 100 kg. of ABC 125 kg.of raw materials are used in April 1990, there was an output of 5,600 kg. of ABC. The standard and actual particulars of April 1990 are as follows:

Materials	Standard		Actual
	Mix   %	Price per kg	Mix   %	Price per kg
Raw Material I Raw Material II Raw Material III	50 30 20	40 20 10	60 20 20	42 16 12

Calculate all variances.

Solution
[TMCV = − 19,600; TMPV = − 5,600; TMUV/TMQV = − 14,000; TMMV = − 14,000;TMYV/TMSUV = Nil; ]

X Y Ltd., manufactures of Product P, uses a standard cost system, Standard product and cost specifications for 1,000 kg. of product P are as follows:

Ingredients		Quantity inKg.		Price per kg.		Cost
A		800		2.50		2,000
B		200		4.00		800
C		200		1.00		200
Input		1,200				3,000	= 2.50 per kg.
Output		1,000				3,000	= 3.00 per kg.

Material records indicate:

	Consumption in January
A	157,000 kg.@ 2.40
B	38,000 kg.@ 4.40
C	36,000 kg.@ 1.20

Actual finished production for the month of January is 200,000 kg

Solution
[TMCV = + 12,800; TMPV = − 6,700; TMUV/TMQV = + 19,500; TMMV = − 3,000;
TMYV/TMSUV = + 22,500; ]

A factory is engaged in producing a product using two grades of materials A and B mixed in the ratio of 3:2. The standard price of material A is 4 per unit and that of B 3 per unit. Normal loss in production is expected at 10%. Due to shortage of materials it was not possible to use the standard mix. However, normal loss is still expected to be 10%. The actual results were as follows:

Material A 280 gms at 3.80 Material B 120 gms at 3.60

Actual production was 369 gms

you are required to calculate all possible material variances.

Solution
[TMCV = − 20; TMPV = − 16; TMUV/TMQV = − 4; TMMV = − 40;TMYV/TMSUV = + 36; ]

A particular alloy is produced by using two types of material viz. S and B in the ratio 2:1. During processing a loss of 5% occurs. Standard material prices are:

S - 1,800 per tonne
B - 1,200 per tonne

During a particular period, for an output of 500 tonnes of Alloy, the actual consumption was:

S - 350 tonnes @ 2,000 per tonne
B - 193 tonnes @ 1,100 per tonne

You are required to calculate all possible material variances.

Solution
[TMCV = − 70,194.73; TMPV = − 50,700; TMUV/TMQV = − 19,494.73; TMMV = + 7,200;
TMYV/TMSUV = − 26,694.73; ]