(SOLVED) Calypso SA manufactures and sells fertilisers Calypso uses the following


Question Description:

$19

Calypso SA manufactures and sells fertilisers. Calypso uses the following standard direct materials costs to produce 1 tonne of fertiliser:
75% of the input materials is Alpha at €400 per tonne ……………….. €360
25% of the input materials is Gamma at €200 per tone……………….. 60
Total standard cost of 1.2 tonnes of inputs……………………………. €420
Note that 1.2 tonnes of input quantities are required to produce 1 tonne of fertiliser. No stocks of direct materials are kept. Purchases are made as needed, so all price variances are related to direct materials used. Calypso produced 2000 tonnes of fertiliser in a particular period. The total direct materials yield variance for the period was €35 000 U. The actual input mix for the period was 50% of Alpha and 50% of Gamma.
Required
1. Calculate the individual direct materials yield variances for the period.
2. Calculate the individual and total direct materials mix variances for the period.
3. Calculate the individual and total direct materials efficiency variances for the period.
4. Briefly describe the conclusions you would draw from the variance analyses.

Answer

$19