Perfect Builders makes all sorts of moldings. Its standard quantity of material allowed is 1 foot of wood per 1 foot of molding at a standard price of $2.00 per foot. During August, it purchased 500,000 feet of wood at a cost of $1.90 per foot, which produced only 499,000 feet of molding. Calculate the materials price variance and the materials usage variance, respectively. $50,000 F and $2,000 U $49,900 U and $2,000 F $49,900 F and $1,900 U $50,000 F and $1,900 U

Perfect Builders makes all sorts of moldings. Its standard quantity of material allowed is 1 foot of wood per 1 foot of molding at a standard price of $2.00 per foot. During August, it purchased 500,000 feet of wood at a cost of $1.90 per foot, which produced only 499,000 feet of molding. Calculate the materials price variance and the materials usage variance, respectively. $50,000 F and $2,000 U $49,900 U and $2,000 F $49,900 F and $1,900 U $50,000 F and $1,900 U

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Description: Perfect Builders makes all sorts of moldings. Its standard quantity of material allowed is 1 foot of wood per 1 foot of molding at a standard price of $2.00 per foot. During August, it purchased 500,000 feet of wood at a cost of $1.90 per foot, which

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter8: Standard Costs And Variances

Section: Chapter Questions

Problem 5PA: Ed Co. manufactures two types of O rings, large and small. Both rings use the same material but...

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Concept explainers

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.

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$50,000 F and $2,000 U

$49,900 U and $2,000 F

$49,900 F and $1,900 U

$50,000 F and $1,900 U

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