Example: Losses, mix and yield
Coope and Sorcerer Co make product T42 in a continuous process, for which standard and actual quantities in month 10 were as follows.
|
Standard
|
|
|
|
Actual
|
|
|
Price
|
|
|
|
Price
|
Std cost of
|
|
Quantity
|
per kg
|
Value
|
|
Quantity
|
per kg
|
actual usage
|
|
kg
|
$
|
$
|
|
kg
|
$
|
$
|
|
Material P
|
40,000
|
2.50
|
100,000
|
|
34,000
|
2.50
|
85,000
|
|
Material Q
|
20,000
|
4.00
|
80,000
|
|
22,000
|
4.00
|
88,000
|
|
60,000
|
|
180,000
|
|
56,000
|
|
173,000
|
Losses occur at an even rate during the processing operation and are expected to be 10% of materials input. Actual output during the month was 53,000 kgs.
Required
Calculate total usage, mix and yield variances.