Question

Domanski Incorporated has established the following raw material standards for its APL4 product: Standard quantity of...

Domanski Incorporated has established the following raw material standards for its APL4 product:

Standard quantity of the material per unit of output 4.5 pounds
Standard price of the material $13.90 per pound


The following data pertain to a recent month's operations:

Actual material purchased 2,000 pounds
Actual cost of material purchased $26,200
Actual material used in production 1,300 pounds
Actual output 220 units of product I92


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

Required:

a. What is the materials price variance for the month?

b. What is a reasonable explanation for this variance?

Toolbar navigation More info

Skip to input field

c. What is the materials quantity variance for the month?

d. What is a reasonable explanation for this variance?

Business   Accounting   
0 0
Add a commentTranscribed image text
Next >

Homework Answers

Answer #1

a. Actual price of the material = 26,200 / 2000 = 13.1

Material Price Variance = Actual Quantity of material purchase * (Standard Price - Actual Price)

= 2,000 * ( 13.9 - 13.1)

= 1600 (unfavorable)

b. The variance is unfavorable because the actual price is higher than the standard price.

c. Material Quantity Variance = Standard Price * ( Standard Quantity - Actual Quantity)

= 13.9 * ( 220*4.5 - 1300)

= 4309 (Unfavorable)

d. The variance is unfavorable because the actual quantity used is higher than the standard quantity.

0 0
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
The following standards have been established for a raw material used to make product O84: Standard...
The following standards have been established for a raw material used to make product O84: Standard quantity of the material per unit of output 8.9 meters Standard price of the material $ 19.00 per meter The following data pertain to a recent month's operations: Actual material purchased 5,300 meters Actual cost of material purchased $ 104,520 Actual material used in production 5,100 meters Actual output 680 units of product O84 The direct materials purchases variance is computed when the materials...
The following standards have been established for a raw material used to make product O84: Standard...
The following standards have been established for a raw material used to make product O84: Standard quantity of the material per unit of output 7.8 meters Standard price of the material $ 19.00 per meter The following data pertain to a recent month's operations: Actual material purchased 4,100 meters Actual cost of material purchased $ 81,590 Actual material used in production 3,800 meters Actual output 570 units of product O84 The direct materials purchases variance is computed when the materials...
The following standards have been established for a raw material used to make product O84: Standard...
The following standards have been established for a raw material used to make product O84: Standard quantity of the material per unit of output 7.4 meters Standard price of the material $ 18.50 per meter The following data pertain to a recent month's operations: Actual material purchased 3,700 meters Actual cost of material purchased $ 71,780 Actual material used in production 3,400 meters Actual output 530 units of product O84 The direct materials purchases variance is computed when the materials...
The following standards have been established for a raw material used to make product I92:         ...
The following standards have been established for a raw material used to make product I92:          Standard quantity of the material per unit of output................................................ 6 pounds Standard price of the material.................. $2.25 per pound Standard hours of labor per unit of output 3 hours Standard rate of the labor per hour $8 per hour The following data pertain to a recent month’s operations: Actual material purchased...................... 13,600 pounds Actual cost of material purchased.......... $31,620 Actual material used in production...........
The following materials standards have been established for a particular product: Standard quantity per unit of...
The following materials standards have been established for a particular product: Standard quantity per unit of output 6.0 meters Standard price $ 19.00 per meter The following data pertain to operations concerning the product for the last month: Actual materials purchased 10,200 meters Actual cost of materials purchased $ 201,500 Actual materials used in production 9,600 meters Actual output 1,580 units What is the materials price variance for the month?
The standards for product V28 call for 8.3 pounds of a raw material that costs $19.00...
The standards for product V28 call for 8.3 pounds of a raw material that costs $19.00 per pound. Last month, 2,200 pounds of the raw material were purchased for $41,360. The actual output of the month was 240 units of product V28. A total of 2,100 pounds of the raw material were used to produce this output. The direct materials purchases variance is computed when the materials are purchased. Required: a. What is the materials price variance for the month?...
The following materials standards have been established for a particular product:   Standard quantity per unit of...
The following materials standards have been established for a particular product:   Standard quantity per unit of output 2.7   grams   Standard price $14.00   per grams The following data pertain to operations concerning the product for the last month:   Actual materials purchased 1,500 grams   Actual cost of materials purchased $ 17,475   Actual materials used in production 1,400 grams   Actual output 370 units The direct materials purchases variance is computed when the materials are purchased. Required: a. What is the materials price variance...
17 A manufacturing company that has only one product has established the following standards for its...
17 A manufacturing company that has only one product has established the following standards for its variable manufacturing overhead. Variable manufacturing overhead standards are based on machine-hours.   Standard hours per unit of output 3.90 machine-hours   Standard variable overhead rate $11.25 per machine-hour The following data pertain to operations for the last month:   Actual hours 8,800 machine-hours   Actual total variable manufacturing overhead cost $95,850   Actual output 2,200 units What is the variable overhead efficiency variance for the month? $2,692 U $7,513...
Turrubiates Corporation makes a product that uses a material with the following standards: Standard quantity 6.7...
Turrubiates Corporation makes a product that uses a material with the following standards: Standard quantity 6.7 liters per unit Standard price $ 1.20 per liter Standard cost $ 8.04 per unit The company budgeted for production of 2,500 units in April, but actual production was 2,600 units. The company used 18,000 liters of direct material to produce this output. The company purchased 18,800 liters of the direct material at $1.3 per liter. The direct materials purchases variance is computed when...
Al-Shabad Company produces a single product. The company has set the following standards for material and...
Al-Shabad Company produces a single product. The company has set the following standards for material and labor. Standard quantity/hours per unit standard price/rate direct materials 7 pounds per unit $7 per pound direct labor 3 hours per unit $10 per hour During the past month the company purchased 7,000 pounds of direct materials at a cost of $17,500. All of this material was used in production of 1,300 units of product. Direct labor totaled $36,750 for the month. The following...
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT