Direct Materials Price and Quantity Variances Junior Company produces one produc

Question

Direct Materials Price and Quantity Variances Junior Company produces one product with the following standard costs: Direct materials (3 pounds @ $2.50) s7.50 Direct labor (1.4 hours @ $12) During the year, Junior produced 10,300 units using 30,000 pounds of material costing $2.40 per pound. Direct labor worked 15,600 hours for total wages of $187,200. 16.80 direct ma Neither favorable nor unfavorable (choose one) 2. The quantity of direct materials for actual production at standard is Unfavorable (choose one). The direct materials quantity variance is $ Now make the following changes to the Interactive Graph. 3. Change the actual direct materials cost per pound to $2.60. becomes unf rable. The direct materials price variance The direct materials quantity becomes favorable 4. Change the actual direct materials used (in pounds) from 30,000 to 42,0o0. The direct maas quantity becomes unfavorable Continue to change the actual direct materials used and the actual cost per pound to determine how the changes impact the direct materials price variance and the direct materials quantity variance.

Explanation / Answer

1). Direct material price variance = (std price- actual price)*actual qty = (2.5-2.4)*30000 = 3000 F

2) Qty of direct materia for actual productuion at standard is = 10300 units * 3pounds = 30900 pounds

Direct material qty variance = (Std qty - actual qty)*std price = (30900-30000)*2.5 = 2250 F

3). Actual direct materia cos per pounds is $2.60.
Direct material price variance = (2.5-2.6)*30000 = 3000 U
Direct material qty variance = (30900-30000)*2.5 = 2250 F

4). Now the actual direct material used is 42000 pounds:
Direct material price variance = (2.5-2.6)*42000 = 4200 U
Direct material qty variance = (30900-42000)*2.5 = 27750 U

Related Questions

Navigate

• Browse (All)
• Browse D
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.