Collegiate Rings produces class rings. Its best-selling model has a direct materials standard of 15 grams of a special alloy per ring. This special alloy has a standard cost of $64.90 per gram. In the past month, the company purchased 15,600 grams of this alloy at a total cost of $1,004,640. A total of 15,500 grams were used last month to produce 1,000 rings. Read the requirements. Requirement 1. What is the actual cost per gram of the special alloy that Collegiate Rings purchased last month? (Round your answer to the nearest cent.) The actual cost per gram of the special alloy that Collegiate Rings purchased last month is
Collegiate Rings produces class rings. Its best-selling model has a direct materials standard of 15 grams of a special alloy per ring. This special alloy has a standard cost of $64.90 per gram. In the past month, the company purchased 15,600 grams of this alloy at a total cost of $1,004,640. A total of 15,500 grams were used last month to produce 1,000 rings. Read the requirements. Requirement 1. What is the actual cost per gram of the special alloy that Collegiate Rings purchased last month? (Round your answer to the nearest cent.) The actual cost per gram of the special alloy that Collegiate Rings purchased last month is
Chapter1: Financial Statements And Business Decisions
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Variance Analysis
In layman's terms, variance analysis is an analysis of a difference between planned and actual behavior. Variance analysis is mainly used by the companies to maintain a control over a business. After analyzing differences, companies find the reasons for the variance so that the necessary steps should be taken to correct that variance.
Standard Costing
The standard cost system is the expected cost per unit product manufactured and it helps in estimating the deviations and controlling them as well as fixing the selling price of the product. For example, it helps to plan the cost for the coming year on the various expenses.
Topic Video
Question
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What is the actual cost per gram of the special alloy that
Collegiate Rings
purchased last month? |
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2.
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What is the direct material price variance?
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3.
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What is the direct material quantity variance?
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How might the direct material price variance for the company last month be causing the direct material quantity variance?
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Transcribed Image Text:Collegiate Rings produces class rings. Its best-selling model has a direct materials standard of 15 grams of a special alloy per ring. This special alloy has a standard cost of $64.90 per
gram. In the past month, the company purchased 15,600 grams of this alloy at a total cost of $1,004,640. A total of 15,500 grams were used last month to produce 1,000 rings.
Read the requirements.
Requirement 1. What is the actual cost per gram of the special alloy that Collegiate Rings purchased last month? (Round your answer to the nearest cent.)
The actual cost per gram of the special alloy that Collegiate Rings purchased last month is
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