Material Cost Variance: The difference between the standard cost of material specified and the actual cost of the material used is the Material Cost Variance. Material Cost Variance arises because of two reasons Actual price of the material varies from the standard price and/or Actual quantity of material used varies from the standard quantity. Therefore, Material Cost Variance is the sum of (i) Material Price Variance and (ii) Material Quantity Variance. The following formulas are used to calculate Material Cost Variance: Material Cost Variance(MCV) = Material Price Variance(MPV) + Material Quantity Variance(MQV) Also Material Cost Variance (MCV) = Standard Cost − Actual Cost Material Cost Variance gives a view of deviations from the set standards which can be either favorable or unfavorable The Actual Total Direct Material Cost

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Answer 1

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Definition Definition System of assigning an estimated cost to the product (instead of the actual cost) so that the product cost can be determined well in advance and the pricing of the product can be done on time. Since the actual cost cannot be predicted at the initial stage of the production process, the estimated cost is recorded in the books. Any deviation of the estimated cost of the actual cost is adjusted in the books at the end of the period.

Chapter 23, Problem 10QS

To determine

Concept Introduction:

Material Cost Variance: The difference between the standard cost of material specified and the actual cost of the material used is the Material Cost Variance. Material Cost Variance arises because of two reasons

Actual price of the material varies from the standard price and/or

Actual quantity of material used varies from the standard quantity.

Therefore, Material Cost Variance is the sum of (i) Material Price Variance and (ii) Material Quantity Variance.

The following formulas are used to calculate Material Cost Variance:

Material Cost Variance(MCV) = Material Price Variance(MPV) + Material Quantity Variance(MQV)

Also Material Cost Variance (MCV) = Standard Cost − Actual Cost

Material Cost Variance gives a view of deviations from the set standards which can be either favorable or unfavorable

The Actual Total Direct Material Cost

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Horngren's Financial & Managerial Accounting: The Managerial Chapters, 8th Edition. E-M:9-16 Using responsibility reports to evaluate cost, revenue, and profit centers The accountant for a subunit of Bellamy Sports Company went on vacation before completing the subunit’s monthly responsibility report. This is as far as she got: Subunit X Revenue by Product Actual Results Flexible Budget Variance F or U Flexible Budget Sales Volume Variance F or U Static Budget Downhill-RI $ 326,000 (a) (b) $ 19,000 F $ 301,000 Downhill-RII $ 154,000 (c) $ 164,000 (d) $ 148,000 Cross-EXI $ 280,000 $ 1,000 U $ 281,000 (e) $ 297,000 Cross-EXII $ 254,000 (f) $ 249,000 $ 16,500 U $ 265,500 Snow-LXI $ 424,000 $ 2,000 F (g) (h) $…

Answer 2

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Definition Definition System of assigning an estimated cost to the product (instead of the actual cost) so that the product cost can be determined well in advance and the pricing of the product can be done on time. Since the actual cost cannot be predicted at the initial stage of the production process, the estimated cost is recorded in the books. Any deviation of the estimated cost of the actual cost is adjusted in the books at the end of the period.

Chapter 23, Problem 10QS

To determine

Concept Introduction:

Material Cost Variance: The difference between the standard cost of material specified and the actual cost of the material used is the Material Cost Variance. Material Cost Variance arises because of two reasons

Actual price of the material varies from the standard price and/or

Actual quantity of material used varies from the standard quantity.

Therefore, Material Cost Variance is the sum of (i) Material Price Variance and (ii) Material Quantity Variance.

The following formulas are used to calculate Material Cost Variance:

Material Cost Variance(MCV) = Material Price Variance(MPV) + Material Quantity Variance(MQV)

Also Material Cost Variance (MCV) = Standard Cost − Actual Cost

Material Cost Variance gives a view of deviations from the set standards which can be either favorable or unfavorable

The Actual Total Direct Material Cost

Expert Solution & Answer

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Answer 3

Question

Definition Definition System of assigning an estimated cost to the product (instead of the actual cost) so that the product cost can be determined well in advance and the pricing of the product can be done on time. Since the actual cost cannot be predicted at the initial stage of the production process, the estimated cost is recorded in the books. Any deviation of the estimated cost of the actual cost is adjusted in the books at the end of the period.

Chapter 23, Problem 10QS

To determine

Concept Introduction:

Material Cost Variance: The difference between the standard cost of material specified and the actual cost of the material used is the Material Cost Variance. Material Cost Variance arises because of two reasons

Actual price of the material varies from the standard price and/or

Actual quantity of material used varies from the standard quantity.

Therefore, Material Cost Variance is the sum of (i) Material Price Variance and (ii) Material Quantity Variance.

The following formulas are used to calculate Material Cost Variance:

Material Cost Variance(MCV) = Material Price Variance(MPV) + Material Quantity Variance(MQV)

Also Material Cost Variance (MCV) = Standard Cost − Actual Cost

Material Cost Variance gives a view of deviations from the set standards which can be either favorable or unfavorable

The Actual Total Direct Material Cost

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

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Answer 4

Question

Definition Definition System of assigning an estimated cost to the product (instead of the actual cost) so that the product cost can be determined well in advance and the pricing of the product can be done on time. Since the actual cost cannot be predicted at the initial stage of the production process, the estimated cost is recorded in the books. Any deviation of the estimated cost of the actual cost is adjusted in the books at the end of the period.

Chapter 23, Problem 10QS

To determine