MA-Rev is an electronics firm operating in Malaysia that specialises in smart mobile devices. Facing intense competition from manufacturers in the region, MA-Rev launched a cost control initiative to improve operational efficiency and protect its margins. This new regime started in October 202X, where production targets were revised and procurement policies tightened. The company allocates fixed overheads based on direct labour hours. Monthly planned production is 14,000 units.

The standard cost per unit of its flagship smart sensor is as follows:

·       Direct materials: 4 kg @ RM20 per kg

·       Direct labour: 3 hours @ RM28 per hour

·       Fixed overhead: RM30 per hour

In October, MA-Rev produced 13,200 units. Materials used was: 35,000 kg at RM21.50 per kg. Labour hours were 40,500 at RM26 per hour. RM405,000 incurred for fixed overhead.

What is the Fixed overhead volume efficiency variance?

MA-Rev assembles its smart mobile devices through multiple processes. In Process 1, printed circuit boards (PCBs) are etched, layered, and tested before being transferred to the next stage for component mounting. Materials introduced at the beginning of the process. Conversions costs introduced evenly throughout the process.                    

MA-Rev uses the Weighted Average method for process costing to streamline reporting across its production lines.

Defects are detectable when inspecting the finished goods. Due to the precision required and occasional defects in etching, a normal loss of 10% on input is expected. Defective PCBs are sold to local recyclers for RM2.80 per unit.

In October, Process 1 has an opening WIP of 5,000 units (45% complete). This has recorded a cost of RM50,000 for direct materials and RM30,000 for conversion.

Units introduced to the process was 30,000 units. 28,000 units were completed and transferred out. Closing WIP was 2,800 units (75% complete).

During the month of October, RM90,000 was incurred for direct materials. Conversion costs include direct labour cost RM40,000, variable overhead RM30,000 and fixed overhead RM110,000.

Compute cost per equivalent unit. 

Provide your answer in 4 decimal places.

Provide your answer in the following format:

Material = RMx.xxxx; Conversion = RMx.xxxx

MA-Rev assembles its smart mobile devices through multiple processes. In Process 1, printed circuit boards (PCBs) are etched, layered, and tested before being transferred to the next stage for component mounting. Materials introduced at the beginning of the process. Conversions costs introduced evenly throughout the process.       

MA-Rev uses the Weighted Average method for process costing to streamline reporting across its production lines.

Defects are detectable when inspecting the finished goods. Due to the precision required and occasional defects in etching, a normal loss of 10% on input is expected. Defective PCBs are sold to local recyclers for RM2.80 per unit.

In October, Process 1 has an opening WIP of 5,000 units (45% complete). This has recorded a cost of RM50,000 for direct materials and RM30,000 for conversion.

Units introduced to the process was 30,000 units. 28,000 units were completed and transferred out. Closing WIP was 2,800 units (75% complete).

During the month of October, RM90,000 was incurred for direct materials. Conversion costs include direct labour cost RM40,000, variable overhead RM30,000 and fixed overhead RM110,000.

Allocate costs to completed units and closing WIP.

Provide your answer in this format:

Transferred out = RMxxx.xxxx; Closing WIP = RMxx.xxxx

MA-Rev is an electronics firm operating in Malaysia that specialises in smart mobile devices. Facing intense competition from manufacturers in the region, MA-Rev launched a cost control initiative to improve operational efficiency and protect its margins. This new regime started in October 202X, where production targets were revised and procurement policies tightened. The company allocates fixed overheads based on direct labour hours. Monthly planned production is 14,000 units.

The standard cost per unit of its flagship smart sensor is as follows:

·       Direct materials: 4 kg @ RM20 per kg

·       Direct labour: 3 hours @ RM28 per hour

·       Fixed overhead: RM30 per hour

In October, MA-Rev produced 13,200 units. Materials used was: 35,000 kg at RM21.50 per kg. Labour hours were 40,500 at RM26 per hour. RM405,000 incurred for fixed overhead.

What is the Fixed overhead volume variance?

MA-Rev is an electronics firm operating in Malaysia that specialises in smart mobile devices. Facing intense competition from manufacturers in the region, MA-Rev launched a cost control initiative to improve operational efficiency and protect its margins. This new regime started in October 202X, where production targets were revised and procurement policies tightened. The company allocates fixed overheads based on direct labour hours. Monthly planned production is 14,000 units.

The standard cost per unit of its flagship smart sensor is as follows:

·       Direct materials: 4 kg @ RM20 per kg

·       Direct labour: 3 hours @ RM28 per hour

·       Fixed overhead: RM30 per hour

In October, MA-Rev produced 13,200 units. Materials used was: 35,000 kg at RM21.50 per kg. Labour hours were 40,500 at RM26 per hour. RM405,000 incurred for fixed overhead.

What is the labour efficiency variance?

MA-Rev is an electronics firm operating in Malaysia that specialises in smart mobile devices. Facing intense competition from manufacturers in the region, MA-Rev launched a cost control initiative to improve operational efficiency and protect its margins. This new regime started in October 202X, where production targets were revised and procurement policies tightened. The company allocates fixed overheads based on direct labour hours. Monthly planned production is 14,000 units.

The standard cost per unit of its flagship smart sensor is as follows:

·       Direct materials: 4 kg @ RM20 per kg

·       Direct labour: 3 hours @ RM28 per hour

·       Fixed overhead: RM30 per hour

In October, MA-Rev produced 13,200 units. Materials used was: 35,000 kg at RM21.50 per kg. Labour hours were 40,500 at RM26 per hour. RM405,000 incurred for fixed overhead.

What is the Fixed overhead expenditure variance?

MA-Rev is an electronics firm operating in Malaysia that specialises in smart mobile devices. Facing intense competition from manufacturers in the region, MA-Rev launched a cost control initiative to improve operational efficiency and protect its margins. This new regime started in October 202X, where production targets were revised and procurement policies tightened. The company allocates fixed overheads based on direct labour hours. Monthly planned production is 14,000 units.

The standard cost per unit of its flagship smart sensor is as follows:

·       Direct materials: 4 kg @ RM20 per kg

·       Direct labour: 3 hours @ RM28 per hour

·       Fixed overhead: RM30 per hour

In October, MA-Rev produced 13,200 units. Materials used was: 35,000 kg at RM21.50 per kg. Labour hours were 40,500 at RM26 per hour. RM405,000 incurred for fixed overhead.

What is the material usage variance?

MA-Rev is an electronics firm operating in Malaysia that specialises in smart mobile devices. Facing intense competition from manufacturers in the region, MA-Rev launched a cost control initiative to improve operational efficiency and protect its margins. This new regime started in October 202X, where production targets were revised and procurement policies tightened. The company allocates fixed overheads based on direct labour hours. Monthly planned production is 14,000 units.

The standard cost per unit of its flagship smart sensor is as follows:

·       Direct materials: 4 kg @ RM20 per kg

·       Direct labour: 3 hours @ RM28 per hour

·       Fixed overhead: RM30 per hour

In October, MA-Rev produced 13,200 units. Materials used was: 35,000 kg at RM21.50 per kg. Labour hours were 40,500 at RM26 per hour. RM405,000 incurred for fixed overhead.

What is the labour rate variance?

MA-Rev is an electronics firm operating in Malaysia that specialises in smart mobile devices. Facing intense competition from manufacturers in the region, MA-Rev launched a cost control initiative to improve operational efficiency and protect its margins. This new regime started in October 202X, where production targets were revised and procurement policies tightened. The company allocates fixed overheads based on direct labour hours. Monthly planned production is 14,000 units.

The standard cost per unit of its flagship smart sensor is as follows:

·       Direct materials: 4 kg @ RM20 per kg

·       Direct labour: 3 hours @ RM28 per hour

·       Fixed overhead: RM30 per hour

In October, MA-Rev produced 13,200 units. Materials used was: 35,000 kg at RM21.50 per kg. Labour hours were 40,500 at RM26 per hour. RM405,000 incurred for fixed overhead.

What is the material price variance?

Which of the following statements is TRUE regarding fixed overhead volume variance?