standard cost sheet for Skyline Company's most popular product shows 3 pounds of material at $5.00 per pound and 1.5 hours at $24 per hour. During the most recent period, Skyline produced 500 units and incurred direct materials cost of $8,384 when it purchased 1,600 pounds and $17,480 for direct labor costs for 760 hours of labor. What is Skyline's materials quantity variance for the period? O $9,096, unfavorable O $500, unfavorable O $884, unfavorable O $384, unfavorable
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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