Ask Question
12 January, 18:20

Budgeted production 26,000 units Actual production 27,500 units Materials: Standard price per ounce $6.50 Standard ounces per completed unit 8 Actual ounces purchased and used in production 228,000 Actual price paid for materials $1,504,800 Labor: Standard hourly labor rate $22 per hour Standard hours allowed per completed unit 6.6 Actual labor hours worked 183,000 Actual total labor costs $4,020,000 Overhead: Actual and budgeted fixed overhead $1,029,600 Standard variable overhead rate $24.50 per standard labor hour Actual variable overhead costs $4,520,000 Overhead is applied on standard labor hours. The direct materials quantity variance is

+4
Answers (1)
  1. 12 January, 20:11
    0
    ($52,000) Unfavorable

    Explanation:

    The computation of direct materials quantity variance is shown below:-

    Direct material quantity variance = (Standard quantity * Standard rate) - (Actual ounces purchased and used in production * Standard rate)

    = ($220,000 * $6.50) - ($228,000 * $6.50)

    = $1,430,000 - $1,482,000

    = ($52,000) Unfavorable

    So, for computing the Direct material quantity variance we simply applied the above formula.
Know the Answer?
Not Sure About the Answer?
Find an answer to your question ✅ “Budgeted production 26,000 units Actual production 27,500 units Materials: Standard price per ounce $6.50 Standard ounces per completed ...” in 📘 Business if you're in doubt about the correctness of the answers or there's no answer, then try to use the smart search and find answers to the similar questions.
Search for Other Answers