Question

Dog Bone Bakery, which bakes dog treats, makes a special biscuit for dogs. Each biscuit uses 0.70 cup of pure semolina flour. They buy 4,000 cups of flour at $0.50 per cup. They use 3,348 cups of flour to make 4,800 biscuits. The standard cost per cup of flour is $0.48.

A. What are the direct materials price variance, the direct materials quantity variances, and the total direct materials cost variance? Round your answers to two decimals. Enter all amounts as positive numbers.

Direct materials price variance	$???	Unfavorable
Direct materials quantity variance	$ ???	Favorable
Total direct materials cost variance	$ ???	Unfavorable

B. What is the standard cost per biscuit for the semolina flour? Round your answer to four decimals.

$

Answer 1

Direct material price variance $66.96 Unfavorable Direct material quantity variance $5.76 Favorable Total direct material cost variance | $61.20 Unfavorable Calculate the direct material price variance in the manner given below: (Standard price - Actual price) Direct material price variance = | Actual quantity consumed ] =($0.48 – $0.50) 3,348 = $66.96 Unfavorable In case of direct material price variance, if the actual price is more than the standard price, then the resultant is considered as unfavorable. And if the standard price is more than the actual price, then the resultant is considered as favorable Standard price of $0.48 is lower than actual price of $0.50, hence it means that resultant is unfavorable. Thus, the direct material price variance is $66.96 unfavorable.

Calculate the direct material quantity variance, in the manner given below: (Actual quantity - Standard quantity) Direct material quantity variance =| x Standard price =[(3.348 - 3,360) < $0.48] = $5.76 Favorable In case of direct material quantity variance, if the actual quantity consumed are more than the standard quantity consumed, then the resultant is considered as unfavorable. And if, the standard quantity consumed is more than the actual quantity consumed, then the resultant is considered as favorable Standard quantity consumed 3,360 is more than actual quantity consumed 3,348, hence it means that the resultant is favorable. Thus, the direct material quantity variance is $5.76 favorable. Calculate the direct material cost variance, in the manner given below: (Standard quantity Standard price) Direct material cost variance = -(Actual quantity Actual price) =[(3,360 $0.48) -(3,348 * $0.50)] = $1,612.80 - $1,674 = $61.20 Unfavorable Material cost variance is the difference between standard cost and actual cost. If standard cost is higher than actual cost, then the resultant is favorable otherwise unfavorable. Standard cost of $1,612.80 is lower than the actual cost of $1,674. Thus, the resultant is S61.20 unfavorable.

Calculate standard cost per biscuit in the manner given below: Standard cost per unit = Standard cost per cup of flour 1x Standard quantity of flour for each biscuit = ($0.48 x 0.70) = $0.3360 Thus, the standard cost per unit is $0.3360.