Question
ABC, Inc., manufactures a single product. The standard cost sheet for this product reflects the following: Direct material 6 per unit Standard material cost $0.85
ABC, Inc., manufactures a single product. The standard cost sheet for this product reflects the following:
Direct material | 6 per unit |
Standard material cost | $0.85 per ounce of material |
In the last quarter, the company manufactured 3794 units of this product. Below is information related to the preparation of these 3794 units:
Total material used in manufacturing | 25040.4 ounces |
Actual material cost | $0.68 per hour |
REQUIRED: Determine the TOTAL material variance (how much higher or lower is the actual total cost compared to the standard total cost). If the variance is favorable, the answer should be positive (e.g., 100), and if it is unfavorable, the answer should be negative (e.g., -100). YOU CAN USE TWO DECIMALS IN YOUR ANSWER.
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