Question

Myers Corporation has the following data related to direct materials costs for November: actual costs for 4,660 pounds of material at $5.40 and standard costs for 4,420 pounds of material at $6.40 per pound. The direct materials quantity variance is

Answer 1

Direct materials quantity variance = $1,536 unfavorable

Step-by-step explanation:

Direct materials quantity variance is the figure obtained when the standard cost is deducted from the actual quantity at standard price. This also known as the direct material usage/efficiency variance.

The direct materials quantity variance can be calculated using the following formula:

Direct materials quantity variance = (Standard Quantity – Actual Quantity) * Standard Price

For this question, we have:

Standard Quantity = Standard pounds of materials used = 4,420

Actual Quantity = Actual pounds of materials used = 4,660

Standard Price = Standard price per pound = $6.40

Therefore, we substitute and have:

Direct materials quantity variance = (4,420 - 4,660) * $6.40 = $1,536 unfavorable

Note that it is unfavorable because the actual pounds of materials used is less than standard pounds of materials used.