Question

The following data relate to direct materials costs for February: Materials cost per yard: standard, $1.90; actual, $2.05 Standard yards per unit: standard, 4.65 yards; actual, 5.08 yards Units of production: 9,500 Calculate the direct materials quantity variance. a.$7,761.50 unfavorable b.$8,374.25 favorable c.$8,374.25 unfavorable d.$7,761.50 favorable

Answer 1

The correct answer is "7,239".

Explanation:

Given values:

Standard price,

SP = $1.90

Actual quantity purchased,

AQP =
`5.08* 9500`

=
`48,260 \ Yards`

Actual price,

AP = $2.05

Now,

The material price variance will be:

=
`(AQP* AP)-(AQP* SP)`

By substituting the values, we get

=
`(48260* 2.05)-(48260* 1.90)`

=
`98933-91694`

=
`7,239`