Question

Direct Materials Variances The following data relate to the direct materials cost for the production of...

Direct Materials Variances

The following data relate to the direct materials cost for the production of 2,500 automobile tires:

Actual: 49,500 lbs. at $1.9 per lb.
Standard: 51,000 lbs. at $1.95 per lb.

a. Determine the direct materials price variance, direct materials quantity variance, and total direct materials cost variance. Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number.

Direct Materials Price Variance $
Direct Materials Quantity Variance $
Total Direct Materials Cost Variance $

Homework Answers

Answer #1
Answer
Sr.No Particulars Formula and Calculation
1 Direct Materials Price Variance (Standard price - Actual price) * Actual quantity
= (1.95 - 1.90) * 49500
= $ - 2475 (F)
2 Direct Materials Quantity Variance (Standard units - Actual units) * Standard rate
= (51000 - 49500) * 1.95
= $ - 2925 (F)
3 Total Direct Materials Cost Variance (Standard Quantity * Standard Price ) - (Actual Quantity * Actual price )
= (51000 * 1.95) - (49500 * 1.90)
= $ - 5400 (F)
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