Kibodeaux Corporation makes a product with the following standard costs:

	Standard Quantity or Hours	Standard Price or Rate	Standard Cost Per Unit
Inputs
Direct materials	8.6 liters	$5.00 per liter	$43.00
Direct labor	0.3 hours	$26.00 per hour	$7.80
Variable overhead	0.3 hours	$3.00 per hour	$.90

The company budgeted for production of 3,600 units in June, but actual production was 3,700 units. The company used 31,450 liters of direct material and 1,055 direct labor-hours to produce this output. The company purchased 33,450 liters of the direct material at $4.90 per liter. The actual direct labor rate was $26.70 per hour and the actual variable overhead rate was $2.60 per hour. The company applies variable overhead on the basis of direct labor-hours. The direct materials purchases variance is computed when the materials are purchased.

The materials quantity variance for June is:

Multiple Choice

• $1,850 U

• $1,850 F

• $860 U

• $860 F