The spending variance for direct materials in November would be closest to: Fixe

Question

The spending variance for direct materials in November would be closest to:

Fixed element per month Revenue Direct labor Direct materials Manufacturing overhead Selling and administrative expenses Total expenses Variable element per unit $38.10 $7.80 16.50 1.60 0.20 $26.10 $0 39,900 20,600 $60,500 Actual results for November: Revenue Direct labor Direct materials Manufacturing overhead Selling and administrative expenses $293,002 $60,286 $127,010 $50,342 $21,104 The spending variance for direct materials in November would be closest to

Explanation / Answer

The spending variance for direct materials in November would be closest to:

Spending variance = Flexible budget direct material-actual direct material

= (7720*16.50)-127010

Spending variance = 370 Favourable

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