Question

) A company provided the following direct materials cost information. Compute the total direct materials cost variance.

Standard costs assigned:

Direct materials standard cost (205,000 units @ $1.00/unit) $ 405,000

Actual costs:

Direct Materials costs incurred (203,750 units @ $1.10/unit) $ 444,125

Enter your answer here:

(Tip: be familiar with whether your numeric answer is either favorable or unfavorable)

4) A company provided the following direct materials cost information. Compute the direct materials price variance.

Standard costs assigned:

Direct materials standard cost (205,000 units @ $1.00/unit) $ 405,000

Actual costs:

Direct Materials costs incurred (203,750 units @ $1.00/unit) $ 444,125

Enter your answer here:

(Tip: be familiar with whether your numeric answer is either favorable or unfavorable)

5) A company provided the following direct materials cost information. Compute the direct materials quantity variance.

Standard costs assigned:

Direct materials standard cost (205,000 units @ $1.00/unit) $ 405,000

Actual costs:

Direct Materials costs incurred (203,750 units @ $1.10/unit) $ 444,125

Answer 1

Solution Question #3 Direct materials standard cost Direct materials Actual cost $405,000 $444,125 Total Direct Material Cost variance - Actual Cost - Standard Cost = $444,125 - $405,000 $39,125 (U) Question #4 Standard Price per unit Actual Price per unit Standard Quantity allowed Actual quantity used $1.00 per unit $1.10 per unit 405,000 units 403,750 units Direct Material Price variance Direct Material Price variance = (Actual Price - Standard Price) x Actual quanity used = ($1.10 - $1.00) x 403,750 = $40,375 (U) Question #5 Standard Price per unit Actual Price per unit Standard Quantity allowed Actual quantity used $1.00 per unit $1.10 per unit 405,000 units 403,750 units Direct Material Quantity variance Direct Material Quantity variance = (Actual quantity used - Standard quantity ) x Standard price = (403,750 units - 405,000 units) x $1.00 = $1,250 (F) Note: In the given questions 3,4 & 5, the number of units are incorrect. When number of units are multiplied with rate, the calculated dollar cost shall differ with the mentioned dollar cost. To solve these questions, the correct number of units have been considered in the above solution.