# Variance Analysis

01 / 10 / 2021 Assignment

This paper circulates around the core theme of Variance Analysis together with its essential aspects. It has been reviewed and purchased by the majority of students thus, this paper is rated 4.8 out of 5 points by the students. In addition to this, the price of this paper commences from £ 99. To get this paper written from the scratch, order this assignment now. 100% confidential, 100% plagiarism-free.

QUESTION 3 Joint costing

Create a spreadsheet to solve the following joint cost problem.

Joint cost allocation: additional processing beyond split-off point

ABC Company produces three joint products: A, B and C. The material is added at the beginning of the process. At the end of Process 1, the split-off point, the three intermediate products enter three separate further processes. Product A enters Process 2, Product B enters Process 3 and Product C enters Process 4. None of the products can be sold unless the subsequent processing is carried out.

The following information relates to the month of June:

(i) Direct material issued to Process 1, \$26 000.

(ii) Conversion costs incurred:

Process 1    \$10 000   \$14 000

Process 2        3 000       2 000

Process 3        1 000       1 000

Process 4           600          400

(iii) There was no work in process at the beginning or end of the month, and no finished goods inventories at the beginning of the month.

(iv) Details of production and sales:

All delivery costs are met by customers.

Required:

(a) A statement showing the allocation of joint costs to products A, B and C using (i) a physical measures method, and (ii) the relative sales value method.

(b) Suppose that C`s price falls to \$7 per tonne. It costs \$5 per tonne to dump material at the tip. Should Product C be dumped at the split-off point or processed further?

Question 4 Variance analysis

A. Solve using a spreadsheet. See the requirements embedded in the spreadsheet. Include the IF function to determine Favourable and Unfavourable variances.

B. Prepare a Business Report as if for senior management:

1. Critically evaluate the purpose of variance analysis,

2. Explain why the materials price variance should be calculated on purchase,

3. Identify other areas in an organisation where variance analysis would be useful and

4. Evaluate the practical relevance of detailed overhead variance analysis

Assessment item 2

Assessment item 2

Due date: 12-May-2016

Return date: 03-Jun-2016

Submission method options

Alternative submission method

QUESTION 3 Joint costing

Create a spreadsheet to solve the following joint cost problem.

Joint cost allocation: additional processing beyond split-off point

ABC Company produces three joint products: A, B and C. The material is added at the beginning of the process. At the end of Process 1, the split-off point, the three intermediate products enter three separate further processes. Product A enters Process 2, Product B enters Process 3 and Product C enters Process 4. None of the products can be sold unless the subsequent processing is carried out.

The following information relates to the month of June:

(i) Direct material issued to Process 1, \$26 000.

(ii) Conversion costs incurred:

Process 1    \$10 000   \$14 000

Process 2        3 000       2 000

Process 3        1 000       1 000

Process 4           600          400

(iii) There was no work in process at the beginning or end of the month, and no finished goods inventories at the beginning of the month.

(iv) Details of production and sales:

All delivery costs are met by customers.

Required:

(a) A statement showing the allocation of joint costs to products A, B and C using (i) a physical measures method, and (ii) the relative sales value method.

(b) Suppose that C`s price falls to \$7 per tonne. It costs \$5 per tonne to dump material at the tip. Should Product C be dumped at the split-off point or processed further?

Question 4 Variance analysis

A. Solve using a spreadsheet. See the requirements embedded in the spreadsheet. Include the IF function to determine Favourable and Unfavourable variances.

B. Prepare a Business Report as if for senior management:

1. Critically evaluate the purpose of variance analysis,

2. Explain why the materials price variance should be calculated on purchase,

3. Identify other areas in an organisation where variance analysis would be useful and

4. Evaluate the practical relevance of detailed overhead variance analysis.

For item 4. see the reading by Murray Wells.

and

http://unilearning.uow.edu.au/report/4b.html

QUESTION 5 Cash budget

Solve:-

2. How much is received from March sales?

3. How much was the sales in March? February?

4. What is meant by what if questions in the context of the budgetary process? What is the purpose of asking this type of question? How are financial models used to answer them? For Scarpa, change the spreadsheet forecasts to show  a negative cash balance for April. Comment. Paste the original normal view and the changed view together with one formula view.

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