Question

All I need is the Materials Price Variance for Material A & B... thanks!

Standard cost per unit 4 units of material Ax $ 6.00 per unit Direct materials 1 unit of material B x $ 8.00 per unit 3 hours x $ 18.00 per hour Direct labor Activity for September Materials purchased 6,750 units x $ 6.20 per unit Material A Material B 1,650 units x $ 8.50 per unit Materials used Material A 6,225 units Material B 1,508 units 4,425 hours x $ 18.80 per hour Direct labor used 1,500 units Production output There were no beginning direct materials inventories. (a) Determine the materials price and quantity variances. Material A Material B Materials price variance $ 1,350 x U 1,350 x U Materials quantity variance 1,350 U 64 U (b) Determine the labor rate and efficiency variances. Labor rate variance $ 3,540 U Labor efficiency variance 1,350 F $

Answer 1

(a)

	Material A		Material B
Materials price variance	1350	U	825	U

Working:

Materials price variance = AQP x (AP - SP)

Material A: 6750 x ($6.20 - $6.00) = $1350 U

Material B: 1650 x ($8.50 - $8.00) = $825 U

Note: Enter the amounts without the dollar sign.