Perfect Pet Collar Company makes custom leather pet collars. The company expects

Question

Perfect Pet Collar Company makes custom leather pet collars. The company expects each collar to require 2.05 feet of leather and predicts leather will cost $3.60 per foot. Suppose Perfect Pet made 55 collars during February. For these 55 collars, the company actually averaged 2.20 feet of leather per collar and paid $3.20 per foot Required: 1. Calculate the standard direct materials cost per unit. (Round your answer to 2 decimal places Direct Materials per Collar 2. Without performing any calculations, determine whether the direct materials price variance will be favorable or unfavorable. Material Price 3. Without performing any calculations, determine whether the direct materials quantity variance will be favorable or unfavorable Material 6. Calculate the direct materials price and quantity variances. (Round your intermediate calculations and final answers to 2 decimal places. Indicate the effect of each variance by selecting "F for favorable, "U" for unfavorable.) Direct Material Price Variance Direct Material Quantity Variance

Explanation / Answer

1. Standard Direct Material cost per unit = Standard Rate * Standard quantity per unit
= $ 3.60/ft * 2.05ft = $7.38

2. Direct material price variance will be favourable. since, $3.20/ft < $3.60/ft

3. Direct material quantity variance will be unfavourable. since, 2.20ft > 2.05ft

6. Direct material Price Variance = (Standard Rate - Actual Rate) * Actual quantity per unit
= ($3.60/ft - $3.20/ft) * 2.20ft = $0.88 (F)

Direct material quantity variance = = (Standard quantity - Actual quantity) * Standard Rate per unit
= (2.05ft - 2.20ft) * $3.60/ft = $ 0.54 (U)

Related Questions

Navigate

• Browse (All)
• Browse P
• Subjects

---

---

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