R Ltd. a manufacturer of portable radios, purchases the components from subcontractors
and
assembles them into a complete radio. Each radio requires three units each of part X which
has
standard cost of 145
per unit.
Following is the result pertaining to part X for the month of December 2010 :
Particulars Units
Purchases ( 18.00.000) 12.000
Consumed in manufacturing 10.000
Radios manufactured 3.000
The material usage variance for the month of December 2010 is
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