Question
Desmond Howard Company makes a product called a Heisman. The owner has hired you to analyze the companys raw materials, specifically metal, for last month.
Desmond Howard Company makes a product called a Heisman. The owner has hired you to analyze the companys raw materials, specifically metal, for last month. Desmond planned to make 500 units. The company actually produced 600 units and used 2,700 pounds of metal.
Last month Desmond purchased 3,000 pounds of metal for $24,000 on account. You also have the companys standard cost card:
| STANDARD COST CARD | |||
| Pounds per unit | Cost/amt | Cost/Unit | |
| DM (metal) | 5 | $ 7.00 | $ 35.00 |
A) What is the actual cost per ounce of metal purchased last month?
B) What was the materials activity variance
C) What was the materials quantity variance?
D) What was the materials price variance?
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