Puvo, Inc., manufactures a single product in which variable manufacturing overhead is assigned on the basis of standard direct labor-hours. The company uses a standard cost system and has established the following standards for one unit of product: Standard QuantityStandard Priceor RateStandard CostDirect materials 2.5pounds$3.50per pound$8.75Direct labor 0.6hours$8.00per hour$4.80Variable manufacturing overhead 0.6hours$1.75per hour$1.05 During March, the following activity was recorded by the company: The company produced 3,400 units during the month.A total of 12,000 pounds of material were purchased at a cost of $33,600.There was no beginning inventory of materials on hand to start the month; at the end of the month, 2,400 pounds of material remained in the warehouse.During March, 2,240 direct labor-hours were worked at a rate of $8.50 per hour.Variable manufacturing overhead costs during March totaled $2,552. The direct materials purchases variance is computed when the materials are purchased. The materials quantity variance for March is: Multiple Choice $3,850 F $18,100 F $18,100 U $3,850 U

Answered: Image /qna-images/answer/c46afb44-dea3-45d9-85a2-59a59838ebb1.jpg

Answered: Puvo, Inc., manufactures a single…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Related questions

Concept explainers

Question

Puvo, Inc., manufactures a single product in which variable manufacturing overhead is assigned on the basis of standard direct labor-hours. The company uses a standard cost system and has established the following standards for one unit of product:

	Standard Quantity	Standard Price or Rate	Standard Cost
Direct materials		2.5	pounds	$	3.50	per pound	$	8.75
Direct labor		0.6	hours	$	8.00	per hour	$	4.80
Variable manufacturing overhead		0.6	hours	$	1.75	per hour	$	1.05

During March, the following activity was recorded by the company:

The company produced 3,400 units during the month.
A total of 12,000 pounds of material were purchased at a cost of $33,600.
There was no beginning inventory of materials on hand to start the month; at the end of the month, 2,400 pounds of material remained in the warehouse.
During March, 2,240 direct labor-hours were worked at a rate of $8.50 per hour.
Variable manufacturing overhead costs during March totaled $2,552.

The direct materials purchases variance is computed when the materials are purchased.

The materials quantity variance for March is:

Multiple Choice

$3,850 F
$18,100 F
$18,100 U
$3,850 U

Expert Solution

Trending now

This is a popular solution!

Step by step

Solved in 2 steps with 2 images

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

Similar questions