
Concept explainers
(a)
Variances: The variances are used to calculate the find the variation in actual cost by comparing it to the
Direct Material Variance: The variance which is used to determine the variation in the standard direct material and actual direct material is called direct material variance. It is the sum of material price variance and material quantity variance.
Material Price Variance: The variance which is used to find the changes in actual price over and above to the estimated price is called material price variance. It is the variation in actual paid for material and the estimated amount required to be paid for the material.
Material Quantity Variance: The variance which is used to compare the in the actual quantity of materials utilized in production with estimated quantity of materials material that is supposed to be used in production and helps to find variation is called material quantity variance.
To determine: Total materials, price and quantity variances.
(b)
The total price and quantity variances for material if the quantity purchased and used is 28,000 units.

Want to see the full answer?
Check out a sample textbook solution
Chapter 25 Solutions
Accounting Principles - Standalone book
- I am looking for a step-by-step explanation of this financial accounting problem with correct standards.arrow_forwardPlease explain the solution to this general accounting problem with accurate principles.arrow_forwardI am looking for help with this general accounting question using proper accounting standards.arrow_forward
- I need the correct answer to this financial accounting problem using the standard accounting approach.arrow_forwardI need help finding the accurate solution to this general accounting problem with valid methods.arrow_forwardThe installment method of revenue recognition is primarily used for_. (a) Service contracts (b) Sales with extended payment terms (c) Construction projects (d) Consignment sales MCQarrow_forward
- AccountingAccountingISBN:9781337272094Author:WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.Publisher:Cengage Learning,Accounting Information SystemsAccountingISBN:9781337619202Author:Hall, James A.Publisher:Cengage Learning,
- Horngren's Cost Accounting: A Managerial Emphasis...AccountingISBN:9780134475585Author:Srikant M. Datar, Madhav V. RajanPublisher:PEARSONIntermediate AccountingAccountingISBN:9781259722660Author:J. David Spiceland, Mark W. Nelson, Wayne M ThomasPublisher:McGraw-Hill EducationFinancial and Managerial AccountingAccountingISBN:9781259726705Author:John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting PrinciplesPublisher:McGraw-Hill Education





