Acoma, Inc., has determined a standard direct materials cost per unit of $7.00 (

Question

Acoma, Inc., has determined a standard direct materials cost per unit of $7.00 (2 feet × $3.50 per foot). Last month, Acoma purchased and used 4,500 feet of direct materials for which it paid $15,300. The company produced and sold 2,080 units during the month.

Calculate the direct materials price, quantity, and spending variances. (Round your intermediate calculations to 2 decimal places. Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable.)

Direct Materials Price Variance Direct Materials Quantity Variance Direct Materials Spending Variance

Explanation / Answer

Direct Materials Price Variance =15300-(4500*3.5)= $450 F Direct Materials Quantity Variance =3.5*(4500-2080*2)= $1190 U Direct Materials Spending Variance =15300-(2080*7)= $740 U

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