Question

The following data are given for Stringer Company: Budgeted production 967 units Actual production 1,021 units Materials: Standard price per ounce $1.98 Standard ounces per completed unit 11 Actual ounces purchased and used in production 11,568 Actual price paid for materials $23,714 Labor: Standard hourly labor rate $14.92 per hour Standard hours allowed per completed unit 4.4 Actual labor hours worked 5,258.15 Actual total labor costs $80,187 Overhead: Actual and budgeted fixed overhead $1,035,000 Standard variable overhead rate $27.00 per standard labor hour Actual variable overhead costs $147,228 Overhead is applied on standard labor hours. The direct materials quantity variance is a.809.36 favorable b.809.36 unfavorable c.667.26 unfavorable d.667.26 favorable

Answer 1

d. 667.26 Favorable

Step-by-step explanation:

Direct materials quantity variance = (Standard quantity allowed - Actual Quantity Used) * Standard Price of a unit of direct material

Direct materials quantity variance = (11*1,021 - 11,568) * $1.98

Direct materials quantity variance = (11,231 - 11,568) * $1.98

Direct materials quantity variance = 337 * $1.98

Direct materials quantity variance = $667.26 Favorable