Direct Materials Variances

The following data relate to the direct materials cost for the production of automobile tires: Actual: 900,000 lbs. at $2.75 per lb. Standard: 916,000 lbs. at $2.70 per lb. 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 V. When lower amounts of direct materials are used because of production efficiencies, the variance would be reported to the 1 1. When the favorable use of raw materiais is caused by the purchase of higher-quality raw materials, the variance should be reporked to the I Tchas My wis Unfavorable variances can be thought of as increasing costs (a debit). Favorable variances can be thought of as decreasing costs (a credit). The direct material cost variance is the difference between the actual and standard material cost per quantity manafactured