Exercise 8-11ADetermining materials price and usage variances

Monique's Florals produced a special Mother's Day arrangement that included eight roses. The standard and actual costs of the roses used in each arrangement follow.

Monique's Florals planned to make 750 arrangements but actually made 790.

Required

a.Determine the total flexible budget materials variance and indicate whether it is favorable (F) or unfavorable (U).

b.Determine the materials price variance and indicate whether it is favorable (F) or unfavorable (U).

c.Determine the materials usage variance and indicate whether it is favorable (F) or unfavorable (U).

d.Confirm the accuracy of Requirementsa,b, andcby showing that the sum of the price and usage variances equals the total variance.

Exercise 8-11BDetermining materials price and usage variances

Amity Company makes paint that it sells in 1-gallon containers to retail home improvement stores. During Year 3, the company planned to make 190,000 gallons of paint. It actually produced 198,000 gallons. The standard and actual quantity and cost of the color pigment for 1 gallon of paint follow.

Required

a.Determine the total flexible budget materials variance for pigment. Indicate whether the variance is favorable or unfavorable.

b.Determine the materials price variance and indicate whether the variance is favorable (F) or unfavorable (U).

c.Determine the materials usage variance and indicate whether the variance is favorable (F) or unfavorable (U).

d.Confirm your answers to Requirementsa,b, andcby showing that the sum of the price and usage variances equals the total variance.