Question

Concord, Inc. makes high-quality swimsuits. During the year, the company produced 760 suits, using 933 yards of material, and the company purchased 772 yards of material for $4,805. The direct materials standard for the swimsuits allows 1.10 yards of material at a standard price of $6 per yard.

Calculate Concord’s direct materials quantity variance for the year. (If variance is zero, select "Not Applicable" and enter 0 for the amounts. Round answer to 0 decimal places, e.g. 15.)

Direct material quantity variance

$Enter direct material quantity variance in dollars rounded to 0 decimal places

Select an option                                                          Not ApplicableFavorableUnfavorable

Answer 1

Standard price = $6 per yard

Standard quantity = 1.1 yard per swimsuit

Actual output = 760 swimsuits

Hence, standard quantity for actual output = 760 x 1.2
= 836 yards

Actual quantity of material used = 933 yards

Direct material quantity variance = Standard price x (Standard quantity - Actual quantity)
= 6 x (836 - 933 )  
= $582 (Unfavorable)

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