$1\mathrm{.}1$Direct Materials Variances

LU$08$ Homework assignment take frame

thaterials cost for the production of $2,000$ automobile tires:

Actual:

$61,700$

lb$.$ at $$1\mathrm{.}85$

Standard:

$62,900$

lb$.$ at $$1\mathrm{.}80$

a$.$ Determine the direct materials price variance, direct materials quantity variance, and total direct materials cost variance. Enter a favorable variance as a negative

number using a minus sign and an unfavorable variance as a positive number.

b$.$ The direct materials price variance should normally be reported to the Purchasing Department $.$ If lower amounts of direct materials had been used

because of production efficiencies, the variance would be reported to the Production Supervisor $.$ If the favorable use of raw materials had been caused by

the purchase of higher$-$quality raw materials, the variance should be reported to the Purchasing Department $.$