..Il cricket 10:14 PM edugen.wileyplus.com Kimmel Accounting, 6e Exercise 23-5 T
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..Il cricket 10:14 PM edugen.wileyplus.com Kimmel Accounting, 6e Exercise 23-5 The standard cost of Product B manufactured by Pharrell Company includes 3.9 units of direct materials at $5.6 per unit. During June, 26,700 units of direct materials are purchased at a cost of $5.45 per unit, and 26,700 units of direct materials are used to produce 6,800 units of Product B. Compute the total materials variance and the price and quantity variances. Materials price varlane Materials quantity variance s Compute the total materials variance and the price and quantity variances, assuming the purchase price is $5.65 and the quantity purchased and used is 26,800 units. Tatal materials variance Materials price variance Materials quantity variance s Question Attempts: of 5 used SVE POR LATERExplanation / Answer
Given,
SQ per unit = 3.9
SP = $5.6 Per unit
AQ = 26,700 units
AP = $5.45 per unit
Actual units of production = 6,800
SQ = 3.9*6800 = 26,250
(a) Total material variance = (AP*AQ) - (SP*SQ) = (5.45*26,700) - (5.6*26,250)
Total material variance = 1,485 (F)
Price Variance = (AP-SP)*AQ = (5.45-5.6)*26,700 = 4,005 (F)
Quantity variance = (AQ-SQ)*SP = (26,700-26,250)*5.6 = 2,520 (U)
(b) Given, AP = $5.65 & AQ = 26,800 units
Total material variance = (5.65*26,800) - (5.6*26,250) = 4,420 (U)
Price Variance = (AP-SP)*AQ = (5.65-5.6)*26,800 = 1,340 (U)
Quantity variance = (AQ-SQ)*SP = (26,800-26,250)*5.6 = 3,080 (F)
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