Question

Hart Company made 4,200 bookshelves using 36,000 board feet of wood costing $360,000. The company's direct materials standards for one bookshelf are 9 board feet of wood at $9.90 per board foot.

Compute the direct materials variances incurred in manufacturing these bookshelves.

Answer 1

Answer: $14220 Favorable

Step-by-step explanation:

Firstly, we will calculate the standard cost to produce 4200 bookshelves. This will be:

= Number of bookshelf × Board feet of wood × Price per board foot

= 4200 × 9 × $9.90

= $374220

Direct material variance will be:

= Standard cost - Actual cost

= $374220 - $360,000

= $14220 Favourable