PDS Manufacturing makes wooden furniture. One of their products is a wooden dresser. The exterior and some of the shelves are made of oak, a high-quality wood, but the interior drawers are made of pine, a less expensive wood. The budgeted direct materials quantities and prices for one dresser are

That is, each dresser is budgeted to use 20 board feet of wood, comprised of 40% oak and 60% pine, although sometimes more pine is used in place of oak with no obvious change in the quality or function of the dresser.
During the month of May, PDS manufactures 3,000 dressers. Actual direct materials costs are:
Oak (23,180 board feet) .........$141,398
Pine (37,820 board feet) ......... 68,076
Total actual direct materials cost .....$209,474
REQUIRED
1. What is the budgeted cost of direct materials for 3,000 dressers?
2. Calculate the total direct materials price and efficiency variances.
3. For the 3,000 dressers, what is the total actual amount of oak and pine used? What is the actual direct materials input mix percentage? What is the budgeted amount of oak and pine that should have been used for the 3,000 dressers?
4. Calculate the total direct materials mix and yield variances. How do these numbers relate to the total direct materials efficiency variance? What do these variances tell you?

Transcribed Image Text:

Price per Unit Cost for One Dresser $48 24 Quantity Oak Pine of Input S6 per board foot 2 per board foot 8 board feet 12 board feet