Fiberworks Company is a manufacturer of fiberglass toy boats. The company has recently implemented a standard cost system and has designed the system to isolate variances as soon as possible. During the month of May, the following results were reported for the production of 25,200 toy boats:

Direct materials (fiberglass) purchased	49,900	pounds
Direct materials issued into production	40,100	pounds
Standard pounds allowed per boat	1.5	pounds
Standard price per pound	$6.48
Cost of fiberglass purchased	$307,384

Required:

a. Calculate the actual cost per pound of fiberglass purchased during May. (Round your answer to 2 decimal places.)

Actual cost

per pound

b. Calculate the direct materials purchase price variance for May. (Do not round intermediate calculations. Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance).)

Direct materials purchase price variance

c. Calculate the direct materials usage variance for May. (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance).)

Direct materials usage variance

d. In the case of raw materials, the control point for the price variance is at the time of purchase rather than when the raw materials are issued into production.

	True
	False