Direct Materials VariancesThe following data relate to the direct materials cost for the production of 1,800 automobile tires:Actual:56,600 lbs. at $1.8 per lb.Standard:54,900 lbs. at $1.85 per lb.a. Determine the direct materials price variance, direct materials quantity variance, and total direct materials cost variance. Enter a favorable variance as a negative number using a minus sign and anunfavorable variance as a positive number.Direct Materials Price Variance$Direct Materials Quantity VarianceTotal Direct Materials Cost Variance$b. The direct materials price variance should normally be reported to theWhen lower amounts of direct materials are used because of production efficiencies, the variance would bereported to theWhen the favorable use of raw materials is caused by the purchase of higher-quality raw materials, the variance should be reported to the

Compute direct material price variance.

Answered: Direct Materials Variances The…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Direct Materials Variances The following data relate to the direct materials cost for the production of 2,300 automobile tires: Actual: 50,800 Ib. at $2.05 Standard: 49,300 Ib. at $2.10 a. Determine the direct materials price variance, direct materials quantity variance, and total direct materials cost variance. Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number. Price variance Favorable Quantity variance Unfavorable Total direct materials cost variance Unfavorable b. The direct materials price variance should normally be reported to the Purchasing Department V. If lower amounts of direct materials had been used because of production efficiencies, the variance would be reported to the Production Supervisor - V. If the favorable use of raw materials had been caused by the purchase of higher-quality raw materials, the variance should be reported to the Purchasing Department
The following data relate to the direct materials cost for the production of 1,800 automobile tires: Actual: 60,900 lb. at $1.70 Standard: 59,100 lb. at $1.75 a. Determine the direct materials price variance, direct materials quantity variance, and total direct materials cost variance. Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number. Price variance $fill in the blank 1 Quantity variance $fill in the blank 3 Total direct materials cost variance $fill in the blank 5
Direct Materials Variances The following data relate to the direct materials cost for the production of 2,500 automobile tires: Actual: 51,100 lbs. at $1.75 per lb. Standard: 49,600 lbs. at $1.8 per lb. a. Determine the direct materials price variance, direct materials quantity variance, and total direct materials cost variance. Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number. Direct Materials Price Variance $fill in the blank 1 Direct Materials Quantity Variance $fill in the blank 3 Total Direct Materials Cost Variance $fill in the blank 5 b. The direct materials price variance should normally be reported to the . If lower amounts of direct materials had been used because of production efficiencies, the variance would be reported to the . If the favorable use of raw materials had been caused by the purchase of higher-quality raw materials, the variance should be reported to the .
Direct Labor Variances The following data relate to labor cost for production of 4,800 cellular telephones: Actual: 3,230 hrs. at $16.30 Standard: 3,180 hrs. at $16.60 a. Determine the direct labor rate variance, direct labor time variance, and total direct labor cost variance. Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number. Rate variance Time variance $1 Total direct labor cost variance $ b. The employees may have been less-experienced or poorly trained, thereby resulting in a labor rate than planned. The lower level of experience or training may have resulted in efficient performance. Thus, the actual time required was than standard.
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Susan Corporation started the year expecting to produce and sell 117,000 units of its super-insulating coffee mugs, but it ended the year having produced and sold even more than that-129,000 units. Needless to say, owners Eli and his sister Anna were thrilled to have exceeded sales goals for the year. By the end of the third quarter, results looked promising. They were even more excited to see the final year-end financial statements and share the great news with their crew. The actual results, along with the original master budget for the year, are as follows. Sales Variable costs: DM DL Variable-MOH Variable SG&A Contribution margin Fixed costs: Fixed-MOH Fixed SG&A Operating income Actual Income $2,560,650 389,064 621.264 268,320 122,550 1,159,452 442,728 436,500 $280,224 Flexible Budget Master Budget $2,357,550 351,000 561,600 210,600 111,150 1,123,200 421,200 409,000 $293,000 In addition to seeing total actual results, the owners would like a more thorough analysis of many of these…
Required Indicate whether each of the following variances is favorable (F) or unfavorable (U). The first one has been done as an example. Note: Select "None" if there is no effect (1.e., zero variance). Item to Classify Sales volume Sales price Materials cost Materials usage Labor cost Labor usage Fixed cost spending Fixed cost per unit (volume) $ $ $ $ $ Standard 40,100 units 3.61 per unit 3.00 per pound 91,100 pounds 10.10 per hour 61,100 hours 401,000 3.21 per unit $ $ $ $ $ Actual 42,100 units 3.64 per unit 3.10 per pound 90,100 pounds 9.70 per hour 61,900 hours 391,000 3.17 per unit Type of Variance F
Direct Materials Variances The following data relate to the direct materials cost for the production of 1,900 automobile tires: Actual: 60,000 lbs. at $1.8 per lb. Standard: 61,800 lbs. at $1.85 per lb. a. Determine the direct materials price variance, direct materials quantity variance, and total direct materials cost variance. Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number. Direct Materials Price Variance $ Direct Materials Quantity Variance $ Total Direct Materials Cost Variance $ b. The direct materials price variance should normally be reported to the . When lower amounts of direct materials are used because of production efficiencies, the variance would be reported to the . When the favorable use of raw materials is caused by the purchase of higher-quality raw materials, the variance should be reported to the .
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