Exercise 11-5 The standard cost of Product B manufactured by Pharrell Company in
ID: 2527632 • Letter: E
Question
Exercise 11-5 The standard cost of Product B manufactured by Pharrell Company includes 2.7 units of direct materials at $6.2 per unit. During June, 26,700 units of direct materials are purchased at a cost of $6.05 per unit, and 26,700 units of direct materials are used to produce 9,800 units of Product B. Compute the total materials variance and the price and quantity variances. Total materials variance Materials price variance Materials quantity variance Compute the total materials variance and the price and quantity variances, assuming the purchase price is $6.25 and the quantity purchased and used is 26,500 units. Total materials variance Materials price variance Materials quantity variance s LINK TO TEXT VIDEO: APPLIED SKILLS VIDEO: SIMILAEXERCISEExplanation / Answer
a) Total material variance = (9800*2.7*6.2)-(26700*6.05) = 2517 Favorable
Material price variance = (6.2-6.05)*26700 = 4005 Favorable
Material quantity variance = (9800*2.7-26700)*6.2 = 1488 Unfavorable
b) Total material variance = (9800*2.7*6.2)-(26500*6.25) = 1573 Unfavorable
Material price variance = (6.2-6.25)*26500 = 1325 Unfavorable
Material quantity variance = (9800*2.7-26500)*6.2 = 248 Unfavorable
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