Question

The per-unit standards for direct materials are 2 gallons at $4 per gallon. Last month, 12200 gallons of direct materials that actually cost $45140 were used to produce 7200 units of product. The direct materials quantity variance for last month was $8800 favorable. $8800 unfavorable. $6100 unfavorable. $6600 favorable.

Answer 1

$8,800 favourable

Step-by-step explanation:

The computation of direct material quantity variance is seen below;

= Standard price × ( Standard quantity - Actual quantity)

= $4 × [(2 gallons × 7,200 units) - 12,200 gallons)

= $4 (14,400 gallons - 12,200 gallons)

= $4 × 2,200 gallons

= $8,800 favorable

Therefore, the direct materials quantity variance for last month is $8,800 favourable