Question

he Strawberry Mansion Company reported the following: Standard quantity per unit 3 lbs Standard price per pound $2.75 Actual pounds used 15,000 lbs Actual price per pound $3.00 Number of units produced 4,900 Determine the direct materials quantity variance.

Answer 1

Direct Material Quantity Variance = 825 Unfavourable

Explanation

Direct Material Quantity Variance =

( Actual Quantity used - Standard Quantity allowed ) × Standard price per unit

{15000- (3lbs × 4900units)} × $2.75

{ 15000-14700 } × 2.75

Direct Material Quantity Variance =825 unfavourable

This is unfavourable as the company had 14700 lbs available but instead the company actually used 15000 lbs .