4. What is the formula for price variances? (10 points)

a. (Actual Price * Actual Quantity) (Standard Price * Actual Quantity)

b. (Standard Price * Standard Quantity) (Standard Price * Actual Quantity)

c. (Actual Quality * Actual Quantity) (Standard Quality * Actual Quantity)

d. (Actual Price * Last Year Quantity) (Last Year Price * Actual Quantity)

Use the information below for the relevant problems

Java Gourmet Coffee reports the following data for April 2010 where 200,000 pounds of roasted gourmet coffee beans were actually produced (note: standard costs do not allow for any wastage),

Actual:

Direct Materials:

Quantity of coffee beans:

210,000 pounds

Cost per pound:

$0.55 per pound

Direct Labor:

Direct labor rate:

$19.00 per hour

Labor hours used:

11,000 hours

Variable Overhead:

Actual costs:

$21,000

Standard:

Direct Materials:

Quantity of coffee beans:

200,000 pounds

Cost per pound:

$0.50 per pound

Direct Labor:

Direct labor rate:

$20.00 per hour

Labor hours to be used:

0.05 hours per pound

Variable overhead:

$.10 per pound