Question
A company uses the following standard costs to produce a single unit of output. --- Direct materials 6 pounds at $0.90 per pound = $
A company uses the following standard costs to produce a single unit of output.
---
Direct materials 6 pounds at $0.90 per pound = $ 5.40
Direct labor 0.50 hour at $10.00 per hour = $ 5.00
Manufacturing overhead 0.50 hour at $4.40 per hour = $ 2.20
---
During the latest month, the company purchased and used 57,000 pounds of direct materials at a price of $1.10 per pound to produce 10,000 units of output. Direct labor costs for the month totaled $45,600 based on 4,750 direct labor hours worked. Variable manufacturing overhead costs incurred totaled $18,000 and fixed manufacturing overhead incurred was $20,000. Based on this information, the direct materials quantity variance for the month was:
Multiple Choice
A.) $2,700 favorable
B.) $11,400 unfavorable
C.) $11,400 favorable
D.) $2,700 unfavorable
E.) $2,000 favorable
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access with AI-Powered Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started