Question

The company applies variable overhead on the basis of direct labor-hours. The direct materials purchases variance is computed when the materials are purchased. The materials quantity variance for October is: _________

a. $1,798 U
b. $1,798 F
c. $1,740 F
d. $1,740 U

Answer 1

The question is about determining the materials quantity variance for a company, but the necessary data to calculate it is missing from the question details.

Step-by-step explanation:

The materials quantity variance is a measure used in managerial accounting to determine the difference between the actual quantity of materials used in production and the standard quantity expected to be used, multiplied by the standard cost per unit of material. In this case, the student is asked to determine which option correctly represents the materials quantity variance for October, but there appears to be insufficient data in the question to calculate the variance directly. To calculate the materials quantity variance, the actual quantity and standard quantity of materials used must be known along with the standard cost per unit.

Without the necessary data, it is impossible to choose between the provided options (a. $1,798 U, b. $1,798 F, c. $1,740 F, d. $1,740 U), which represent a variance that is either unfavorable (U) or favorable (F) in the amounts specified. Therefore, additional information is required to address the question accurately.

Answer 2

c. $1,740 F

Step-by-step explanation:

The
`$\text{material quantity variance}$` is the measure of the
`$\text{difference}$` between the amount of materials that is used in actual for the production process and the amount of the material that was expected or estimated to be used in the production process.

It is given that the Snuggs Corporation applies the variable overhead on direct labor hour basis.

Therefore, the SQ = 2.8 ounces per unit x 1100 units = 3080 ounces

The materials quantity variance = (AQ - SQ) x SP

= (2790 ounces - 3080 ounces) x $ 6 per ounce

= (-290 ounces) x $ 6

= $ 1740 F