Question

A manufactured product has the following information for June. Direct materials Direct labor Overhead Units manufactured Standard (6 lbs. @ $8 per lb.) (2 hrs. @ $15 per hr.) (2 hrs. @ $12 per hr.) Actual 47, 300 lbs. @ $8.10 per lb. 15, 300 hrs. @ $15.50 per hr. $192,900 7,800 Exercise 21-9 Direct materials variances LO P2 Compute the direct materials price variance and the direct materials quantity variance. Indicate whether each variance is favorable or unfavorable. AQ = Actual Quantity SQ = Standard Quantity AP = Actual Price SP = Standard Price Actual Cost Standard Cost $ 0 $ 0 $ 0

Answer 1

Actual Cost								Standard cost
AQ	AP	AQ*AP		AQ	SP	AQ*SP		SQ	SP	SQ*SP
47300	8.10	383130		47300	8	378400		46800	8	374400
			4730				4000
Direct material price variance				4730	Unfavorable
Direct material quantity variance				4000	Unfavorable
Total material variance				8730	Unfavorable