Final answer:
To calculate material, price, and quantity variances, compare standard and actual costs. Material Quantity Variance (MQV) is -$2,900 unfavorable, Material Price Variance (MPV) is $10,150 favorable, and the total materials variance is $7,250 favorable.
Step-by-step explanation:
The student is asking how to calculate the materials variance, and the price and quantity variances for product B manufactured by Sweet Acacia Company. To calculate these variances, first, we need to determine the standard cost of the materials for the actual production, then compare it with the actual cost.
The standard cost for the direct materials is 3 units at $5.80 each per product. For 9,500 units of product B, the standard quantity of materials is 9,500 products × 3 units/product = 28,500 units.
The material quantity variance (MQV) is calculated as (Standard Quantity - Actual Quantity) × Standard Price. The Actual Quantity is 29,000 units, so MQV = (28,500 units - 29,000 units) × $5.80/unit = -$2,900 unfavorable, since the company used more materials than the standard.
The material price variance (MPV) is calculated as (Standard Price - Actual Price) × Actual Quantity. The Actual Price is $5.45/unit, so MPV = ($5.80/unit - $5.45/unit) × 29,000 units = $10,150 favorable, because the actual price per unit is less than the standard price.
The total materials variance is the sum of the MQV and MPV, thus $10,150 favorable - $2,900 unfavorable = $7,250 favorable.