Asked by Andres Soler on May 01, 2024
Verified
Solly Corporation produces a product for national distribution. Standards for the product are:Materials: 12 ounces per unit at 60¢ per ounce.Labor: 2 hours per unit at $8 per hour.During the month of December, the company produced 1,000 units. Information for the month follows:Materials: 14,000 ounces purchased and used at a total cost of $7,700.Labor: 2,500 hours worked at a total cost of $20,625.The materials quantity variance is:
A) $1,200 Unfavorable
B) $1,100 Unfavorable
C) $1,100 Favorable
D) $1,200 Favorable
Standards
Criteria or benchmarks used for measuring performance or quality in various fields, including manufacturing, auditing, and accounting.
Actual Information
Factual data or evidence that is true and accurate, without alteration or distortion.
- Conduct evaluations and calculations of direct material variances, notably price and quantity discrepancies.
Verified Answer
ZK
Zybrea KnightMay 05, 2024
Final Answer :
A
Explanation :
The standard quantity of materials for 1,000 units is 12,000 ounces (12 oz per unit x 1,000 units). The actual quantity of materials used is 14,000 ounces, which is 2,000 ounces over the standard quantity.
Materials Quantity Variance = (Actual Quantity - Standard Quantity) x Standard Price
= (14,000 - 12,000) x $0.60
= $1,200 Unfavorable
Materials Quantity Variance = (Actual Quantity - Standard Quantity) x Standard Price
= (14,000 - 12,000) x $0.60
= $1,200 Unfavorable
Learning Objectives
- Conduct evaluations and calculations of direct material variances, notably price and quantity discrepancies.
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