Under normal conditions, Sarah spends $8.40 per unit of materials, and it will take 3.60 units of material per pair of shoes. During July, Sole Purpose Shoe Company incurred actual direct materials costs of $63,101 for 7,090 units of direct materials in the production of 2,200 pairs of shoes. Complete the following table, showing the direct materials variance relationships for July for Sole Purpose Shoe Company. If required, round your answers to two decimal places. When entering variances, use a negative number for a favorable cost variance, and a positive number for an unfavorable cost variance. Actual Cost Standard Cost Actual Quantity X Actual Price Actual Quantity X Standard Price Standard Quantity X Standard Price fill in the blank 778d0b09400dff7_1 X $fill in the blank 778d0b09400dff7_2 fill in the blank 778d0b09400dff7_3 X $fill in the blank 778d0b09400dff7_4 fill in the blank 778d0b09400dff7_5 X $fill in the blank 778d0b09400dff7_6 = $fill in the blank 778d0b09400dff7_7 = $fill in the blank 778d0b09400dff7_8 = $fill in the blank 778d0b09400dff7_9 Unfavorable Direct Materials Price Variance: Direct Materials Variance: $fill in the blank 778d0b09400dff7_14 $fill in the blank 778d0b09400dff7_15 Total Direct Materials Variance: $fill in the blank 778d0
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.
Direct Materials
Under normal conditions, Sarah spends $8.40 per unit of materials, and it will take 3.60 units of material per pair of shoes. During July, Sole Purpose Shoe Company incurred actual direct materials costs of $63,101 for 7,090 units of direct materials in the production of 2,200 pairs of shoes.
Complete the following table, showing the direct materials variance relationships for July for Sole Purpose Shoe Company. If required, round your answers to two decimal places. When entering variances, use a negative number for a favorable cost variance, and a positive number for an unfavorable cost variance.
| Actual Cost | Standard Cost | |||||||||
| Actual Quantity |
X | Actual Price |
Actual Quantity |
X | Standard Price |
Standard Quantity |
X | Standard Price |
||
| fill in the blank 778d0b09400dff7_1 | X | $fill in the blank 778d0b09400dff7_2 | fill in the blank 778d0b09400dff7_3 | X | $fill in the blank 778d0b09400dff7_4 | fill in the blank 778d0b09400dff7_5 | X | $fill in the blank 778d0b09400dff7_6 | ||
| = $fill in the blank 778d0b09400dff7_7 | = $fill in the blank 778d0b09400dff7_8 | = $fill in the blank 778d0b09400dff7_9 | ||||||||
| Unfavorable Direct Materials Price Variance: |
Direct Materials Variance: |
|||||||||
| $fill in the blank 778d0b09400dff7_14 | $fill in the blank 778d0b09400dff7_15 | |||||||||
| Total Direct Materials Variance: |
||||||||||
| $fill in the blank 778d0b09400dff7_18 |
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