# Direct Materials Cost Analysis for a Product## Product Cost InformationA company reports the following cost details for one of its products:- **Direct materials standard:** 3 pounds at $2 per pound, totaling $6 per unit- **Actual direct materials used (AQ):** 280,000 pounds- **Actual units produced:** 72,000 units- **Actual cost of direct materials used:** $476,000## Key Terminology- **AQ (Actual Quantity):** The actual amount of materials used in production.- **SQ (Standard Quantity):** The standard amount of materials expected to be used.- **AP (Actual Price):** The actual cost per unit of material.- **SP (Standard Price):** The standard cost per unit of material.## ObjectiveCompute the direct materials price and quantity variances to determine whether each is favorable or unfavorable.## Diagram ExplanationThe diagram consists of two main sections with tables for cost calculations:1. **Actual Cost Section:** - Contains rows and columns for calculating actual cost components using actual quantity and price. 2. **Standard Cost Section:** - Contains rows and columns for calculating standard cost components using standard quantity and price.Each section involves spaces to input values for calculating variances between actual and standard costs. These spaces have directional arrows indicating where calculations should be entered.The variances determined will help identify where the cost efficiencies or inefficiencies lie in terms of material pricing and quantity usage.

Name: # Direct Materials Cost Analysis for a Product## Product Cost Informa
Uploaded: 2024-03-20T06:33:06.000Z
Channel: Bartleby
Description: # Direct Materials Cost Analysis for a Product## Product Cost InformationA company reports the following cost details for one of its products:- **Direct materials standard:** 3 pounds at $2 per pound, totaling $6 per unit- **Actual direct materials

Calculation of Direct material price Variance:: Actual quantity*(Standard price------Actual price).... Actual price per pound:::$4,76,000/2,80,000 pounds=$1.7 per pound... 2,80,000 pounds*($2-$1.7)=2,80,000 pounds*$0.3=$84000(Favourable)..Calculation of Direct material quantity variance:: Standard quantity for actual output is::72000 units*3 pounds =216000 pounds...... Standard price*(Standard Quantity--Actual quantity)... $2*(216000 pounds-2,80,000 pounds)=$2*64000 pounds=$128000(Unfavorable)...

Business

Accounting

A company reports the following for one of its products. Direct materials standard (3 pounds e $2 per pound) Actual direct materials used (AQ) Actual units produced Actual cost of direct materials used $ 6 per unit 280,000 pounds 72,000 units $ 476,000 AQ = Actual Quantity SQ = Standard Quantity AP = Actual Price SP = Standard Price Compute the direct materials price and quantity variances and identify each as favorable or unfavorable. Actual Cost Standard Cost

A company reports the following for one of its products. Direct materials standard (3 pounds e $2 per pound) Actual direct materials used (AQ) Actual units produced Actual cost of direct materials used $ 6 per unit 280,000 pounds 72,000 units $ 476,000 AQ = Actual Quantity SQ = Standard Quantity AP = Actual Price SP = Standard Price Compute the direct materials price and quantity variances and identify each as favorable or unfavorable. Actual Cost Standard Cost

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

I attached a picture of the accounting excel problem instructions (on the word document) and a picture of the excel spreadsheet that need the formulas answered. thank you for your help.
Please do not give solution in image format thanku
Assume that a company wants to separate a mixed cost into its variable and fixed elements for cost estimation purposes. It provided the following information: Week Units Produced Mixed Cost 1 12,000 $ 35, 300 2 13, 500 $ 39, 500 3 14, 000 $ 41, 100 4 13, 700 $ 39, 620 5 11,500 $ 34,400 6 10, 100 $ 32, 050 7 10,800 $ 32, 380 8 14, 400 $ 41,890 9 11, 200 $ 34, 200 10 13, 200 $ 39, 150 Using least - squares regression, the estimate for the fixed cost per week is closest to:
Hw.44.
Material Material Actual Standard Actual Standard Price Usage Total Supplier Price Price Quantity Quantity Var Var Variance Current $7.50 $7.50 25,000 24,240 $0 Alternative #1 $7.35 $7.50 25,500 24,240 $0 Alternative #2 $7.58 $7.50 24,400 24,240 $0 Standard Quantity is 2.02 components Quantity produced is 12,000 You are a plant manager and have been approached by your purchasing manager about swapping out one of your suppliers. The manager has identified a vendor who will supply a key component at a 2% discount to your current supplier. At the same time, the supervisor of the group approaches you to indicate that the current supplier is not consistently meeting tolerances. The supervisor suggests a second vendor who promises better quality. You decide to run three batches, each with a different component. Results are in the table above. Task 1 Calculate the Material Price Variance for each component. Task 2 Calculate the Material Usage Variance for each component. Task 3 Based on the…
Please do not give solution in image format thanku
Please Do not Give image format
Please answer complete question, otherwise skip it,,,answer in text form please (without image)
Direct Labor Actual Data: Units produced Direct Labor Standard Cost Data per 1 Unit Quantity Price 2 hrs $41/hr SHOW ALL COMPUTATIONS. 20 units 39 hrs; total cost $1560 Compute rate variance, efficiency variance, direct labor variance
nformation about direct materials cost follows for a local company: Standard price per materials gram $ 20 Actual quantity used 2,760 grams Standard quantity allowed for production 2,900 grams Price variance $ 19,320 F Required: What was the actual purchase price per gram?
A company reports the following for one of its products. Direct materials standard (4 pounds @ $3 per pound) Actual direct materials used (AQ) Actual units produced Actual cost of direct materials used $12 per unit 330,000 pounds 64,000 units Actual Cost $ 924,000 AQ - Actual Quantity SQ - Standard Quantity = AP = Actual Price SP Standard Price Compute the direct materials price and quantity variances and Identify each as favorable or unfavorable. Standard Cost
Sharp Company manufactures a product for which the following standards have been set: \table[[, Standard Quantity, Standard Price, Standard], [, or Hours, or Rate,Cost], [Direct materials,3 feet, $5 per foot, $15 I need to spending Variance 1 B and 2b