Question 8 data is below Assume the standard cost data pertaining to direct mate

Question

Question 8 data is below

Assume the standard cost data pertaining to direct materials given in Question 8 for Chips Inc. At the beginning of July 2018 Dale Walmsley is looking over the information shown in the table. the OPH related results for FY2017. Dale has accumulated FY2017 Results Actual lbs. of OPH purchased in FY 2017 Average cost per pound Actual lbs. of OPH used in production Units of Widgets produced in FY 2017 1,525,000 $2.76 1,515,850 497,000 Answers How much did Chips spend on purchasing OPH? How much should Chips have spent on purchasing OPH if it paid the budgeted price? What is the price variance on purchases? A positive number denotes an unfavorable variance. How many pounds of OPH should Chips have used in its production of OPH for the year? What is the quantity variance related to the use of OPH in the production of Widgets for the year. A positive number denotes an unfavorable variance

Explanation / Answer

First question

Standard quantity= 497000*3= 1491000

Actual quantity= 1515850

Variance= (1515850- 1491000)*$2.80= $69580

Question 8

1547000*$2.80= $4331600

Sales= 510000*110%= 561000

Widgets to be produced= 561000+41000-44000=558000

OPH required= 558000*3= 1674000

Purchases =1674000+66000-40000= 1700000

In amount= 1700000* $2.80= $4760000

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