You have been provided with the budgeted and actual information of XYZ Ltd as shown below;
Budgeted information for May 2020
Production in units
25,000
Direct material (250,000 kgs)
Tshs 362,500
Direct labour (87,500 hours) Tshs 1,089,375
Variable production overheads
Tshs 271,250
Actual results achieved for May 2020
Production in units
Direct material (263,250 kgs)
Direct labour 197,200 hours)
Variable production overheads
27,000
Tshs 394,875
Tshs 1,190,700
Tshs 306,180
Notes:
1. Actual fixed productions overheads for May 2020 amounted to Tshs
172,400
2. Budgeted fixed production overheads was Tshs 175,000 per month
3. Variable production overheads were applied to products based on
budgeted labour hours
Required:
a) Prepare a cost statement showing the original budget, flexed budget and
actual results.
(9 marks)
b) Briefly explain behaviour issues that may arise as part of the annual
budgeting process
(6 mark

The new york times (nov. 30, 1993) reported that “the inability of opec to agree last week to cut production has sent the oil market into turmoil . . [leading to] the lowest price for domestic crude oil since june 1990.” why were the members of opec trying to agree to cut production? so they could save more oil for future consumption so they could lower the price so they could raise the price why do you suppose opec was unable to agree on cutting production? because each country has a different production capacity because each country experiences different production costs because each country has an incentive to cheat on any agreement the newspaper also noted opec’s view “that producing nations outside the organization, like norway and britain, should do their share and cut production.” what does the phrase “do their share” suggest about opec’s desired relationship with norway and britain? opec would like norway and britain to keep their production levels high. opec would like norway and britain to act competitively. opec would like norway and britain to join the cartel.