Manzana Company produces apple juice sold in gallons. Recently, the company adopted the following material standard for one gallon of its apple juice: Direct materials 128 oz. @ $0.05 = $6.40 During the first week of operation, the company experienced the following results: a. Gallon units produced: 20,000. b. Ounces of materials purchased and used: 2,650,000 ounces at $0.045. c. No beginning or ending inventories of raw materials. Required: 1. Compute the materials price variance. 2. Compute the materials usage variance.

Manzana Company produces apple juice sold in gallons. Recently, the company adopted the following material standard for one gallon of its apple juice: Direct materials 128 oz. @ $0.05 = $6.40 During the first week of operation, the company experienced the following results: a. Gallon units produced: 20,000. b. Ounces of materials purchased and used: 2,650,000 ounces at $0.045. c. No beginning or ending inventories of raw materials. Required: 1. Compute the materials price variance. 2. Compute the materials usage variance.

Principles of Cost Accounting

17th Edition

ISBN:9781305087408

Author:Edward J. Vanderbeck, Maria R. Mitchell

Publisher:Edward J. Vanderbeck, Maria R. Mitchell

Chapter8: Standard Cost Accounting—materials, Labor, And Factory Overhead

Section: Chapter Questions

Problem 3P: Zippy Inc. manufactures a fuel additive, Surge, which has a stable selling price of 44 per drum. The...

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