Question

Help Save & Exit Submit Required information [The following information applies to the questions displayed below.] Hart Company made 4,400 bookshelves using 34,000 board feet of wood costing $387600. The company's direct materials standards for one bookshelf are 8 board feet of wood at $11.30 per board foot (1) Compute the direct materials price and quantity variances incurred in manufacturing these bookshelves. AQ Actual Quantity SQ Standard Quantity AP Actual Price SP Standard Price 5tandard Cost Actual Cost AQ SP SP SQ AQ АP х 35,200 34,000 $ 11.40 34,000 387 600 S 0 0 2 of 5 Next <Prev 90 ENG arch DELL

Answer 1

Ans. 1	Actual Cost		Actual quantity at Standard price		Standard Cost
	Actual quantity * Actual price		Actual quantity * Standard price		Standard quantity * Standard price
	34,000 * $11.40		34,000 * $11.30		35,200 * $11.30
	$387,600		$384,200		$397,760
		-$3,400		$13,560
	Materials price variance	-$3,400	or   $3,400 Unfavorable
	Materials quantiy variance	$13,560	or   $13,560 Favorable
	Total Materials Variance	$10,160	or   $10,160 Favorable
	*Materials price variance = Actual quantity at standard price - Actual cost
	*Materials quantity variance = Standard cost - Actual quantity at standard price
	*Standard quantity (SQ)   =   Actual output * Materials quantity per unit of output
	4,400 * 8
	35,200
	*Actual rate   = Actual cost / Actual quantity
	$387,600 / 34,000
	$11.40	per board feet
	*If the standard cost, price and quantity are higher than the actual it means the variance is favorable.
	*If the standard cost, price and quantity are lower than the actual it means the variance is unfavorable.