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Posted on Jul 31, 2024

FAR Company produces a line of all-vinyl mats. Each doormat calls for 0.4 meter of vinyl material that costs $3.10 per meter. In August 2025

FAR Company produces a line of all-vinyl mats. Each doormat calls for 0.4 meter of vinyl material that costs $3.10 per meter. In August 2025 the division manufactured and sold 60,000 doormats. During the month, 25,200 meters of vinyl material were used at a total cost of $73,080. Calculate the direct materials price variance, the direct materials quantity variance and the total direct materials variance and state whether they are favorable or not. Provide one reasonable cause for each of the three variances. ANSWER BY CHOOSING THE MOST APPROPRIATE ANSWER FROM BELOW: Select one: a.DM price variance:$5,040 favorable (cause:vendor gave a discount), DM quantity variance:$3,720 unfavorable (cause: faulty equipment), Total DM variance:$1,320 favorable (cause: positive price variance made up for the negative variance due to quantity). b.DM price variance:$5,040 unfavorable (cause:vendor gave a discount), DM quantity variance:$3,720 unfavorable (cause: faulty equipment), Total DM variance:$8,760 unfavorable (cause: cost overruns across both aspects). c.DM price variance:$3,720 unfavorable (cause:vendor gave a discount), DM quantity variance:$5,040 unfavorable (cause: faulty equipment), Total DM variance:$8,760 unfavorable (cause: cost overruns across both aspects). d.DM price variance:$3,720 favorable (cause:vendor gave a discount), DM quantity variance:$5,040 unfavorable (cause: faulty equipment), Total DM variance:$1,320 unfavorable (cause: negative quantity variance outweighed the positive variance due to price). e.DM price variance:$5,040 favorable (cause:vendor gave a discount), DM quantity variance: $3,720 favorable (cause: excellent workmanship), Total DM variance:$8,760 favorable (cause: cost savings across both aspects). f.DM price variance:$5,040 favorable (cause:vendor increased prices), DM quantity variance:$3,720 unfavorable (cause: labor union intervention), Total DM variance:$1,320 favorable (cause: positive price variance made up for the negative variance due to quantity). g.DM price variance:$5,040 unfavorable (cause:factory rent increased), DM quantity variance:$3,720 unfavorable (cause: faulty equipment), Total DM variance:$8,760 unfavorable (cause: cost overruns across both aspects). h.DM price variance:$5,040 favorable (cause: factory rent increased), DM quantity variance:$3,720 unfavorable (cause: faulty eq Total DM variance:$1,320 favorable (cause: positive price variance made up for the negative variance due to quantity). i.DM price variance:$5,040 unfavorable (cause:factory rent increased), DM quantity variance: $3,720 unfavorable (cause: low supervision), Total DM variance:$8,760 unfavorable (cause: cost overruns across both aspects).

FAR Company produces a line of all-vinyl mats. Each doormat callf for 0.4 meter of vinyl material that costs $3.10 per meter. in August 2025 the division manufactured and sold 60,000 doormats. During the month, 25,200 meters of vinyl material were used at a total cost of $73,080. Calculate the direct materials price variance, the direct materials quantity variance and the total direct materials variance and state whether they are favorable or not. Provide one reasonable cause for each of the thre variances. ANSWER BY CHOOSING THE MOST APPROPRIATE ANSWER FROM BELOW: Select one; a.DM price variance:\$5,040 favorable (cause:vendor gave a discount), DM quantity variance.\$3,720 unfavorable (cause; faulty equipment), Total DM variance:\$1,320 favorable (cause: positive price variance made up for the negative variance due to quantity) b.DM price variance: $5,040 unfavorable (cause:vendor gave a discount). DM quantity variance: $3,720 unfavorable (cause; faulty equipment) Total DM variance:\$8,760 unfavorable (cause; cost overruns across both aspects). c. DM price variance:\$3,720 unfavorable (cause'vendor gave a discount), DM quantity variance:\$5,040 unfavorable (cause faulfy equipment) Total DM variance:\$8,760 unfavorable (cause: cost overruns across both aspects). d.DM price variance:\$3,720 favorable (causevendor gave a discount). DM quantity variance:\$5,040 unfavorable (cause; faulty equipment), Total DM variance:\$1,320 unfavorable (cause: negative quantity variance outweighed the positive variance due to price). e.DM price variance:\$5,040 favorable (causevendor gave a discount), DM quantity variance:\$3,720 favorable (cause: excellent workmanship), Total DM variance:\$8,760 favorable (cause; cost savings across both aspects). f.DM price variance:\$5,040 favorable (cause:vendor increased prices). DM quantity variance:\$3,720 unfavorable (cause: labor union intervention). Total DM variance:\$1,320 favorable (cause: positive price variance made up for the ncgative variance due to quantity) 9.DM price variance: $5,040 unfavorable (cause:factory rent increased). DM quantity variance: $3,720 unfavorable (cause: faulty equipment) Total DM variance:\$8,760 unfavorable (cause: cost overruns across both aspects). h.DM price variance:\$5,040 favorable (cause: factory rent increased), DM quantity variance:\$3,720 unfavorable (cause; fauity eq Total DM variance:\$1,320 favorable (cause; positive price variance made up for the negative variance due to quantity). I.DM price variance-\$5,040 unfavorable (cause:factory rent increased), DM quantity variance:\$3,720 unfavorable (cause; low supervision). Total DM variance:\$8,760 unfavorable (causes cost overruns across both aspects). FAR Company produces a line of all-vinyl mats. Each doormat callf for 0.4 meter of vinyl material that costs $3.10 per meter. in August 2025 the division manufactured and sold 60,000 doormats. During the month, 25,200 meters of vinyl material were used at a total cost of $73,080. Calculate the direct materials price variance, the direct materials quantity variance and the total direct materials variance and state whether they are favorable or not. Provide one reasonable cause for each of the thre variances. ANSWER BY CHOOSING THE MOST APPROPRIATE ANSWER FROM BELOW: Select one; a.DM price variance:\$5,040 favorable (cause:vendor gave a discount), DM quantity variance.\$3,720 unfavorable (cause; faulty equipment), Total DM variance:\$1,320 favorable (cause: positive price variance made up for the negative variance due to quantity) b.DM price variance: $5,040 unfavorable (cause:vendor gave a discount). DM quantity variance: $3,720 unfavorable (cause; faulty equipment) Total DM variance:\$8,760 unfavorable (cause; cost overruns across both aspects). c. DM price variance:\$3,720 unfavorable (cause'vendor gave a discount), DM quantity variance:\$5,040 unfavorable (cause faulfy equipment) Total DM variance:\$8,760 unfavorable (cause: cost overruns across both aspects). d.DM price variance:\$3,720 favorable (causevendor gave a discount). DM quantity variance:\$5,040 unfavorable (cause; faulty equipment), Total DM variance:\$1,320 unfavorable (cause: negative quantity variance outweighed the positive variance due to price). e.DM price variance:\$5,040 favorable (causevendor gave a discount), DM quantity variance:\$3,720 favorable (cause: excellent workmanship), Total DM variance:\$8,760 favorable (cause; cost savings across both aspects). f.DM price variance:\$5,040 favorable (cause:vendor increased prices). DM quantity variance:\$3,720 unfavorable (cause: labor union intervention). Total DM variance:\$1,320 favorable (cause: positive price variance made up for the ncgative variance due to quantity) 9.DM price variance: $5,040 unfavorable (cause:factory rent increased). DM quantity variance: $3,720 unfavorable (cause: faulty equipment) Total DM variance:\$8,760 unfavorable (cause: cost overruns across both aspects). h.DM price variance:\$5,040 favorable (cause: factory rent increased), DM quantity variance:\$3,720 unfavorable (cause; fauity eq Total DM variance:\$1,320 favorable (cause; positive price variance made up for the negative variance due to quantity). I.DM price variance-\$5,040 unfavorable (cause:factory rent increased), DM quantity variance:\$3,720 unfavorable (cause; low supervision). Total DM variance:\$8,760 unfavorable (causes cost overruns across both aspects)