Question
Petty Petroleum Inc. uses various chemicals to manufacture its products. Variance data for last month for the 3 primary chemicals used in production are as
Petty Petroleum Inc. uses various chemicals to manufacture its products. Variance data for last month for the 3 primary chemicals used in production are as follows:
X42- AY8 9BZ
$84,000 F $ 50,000 F $ 42,000 U - Material price variance
80,000 U 60,000 U 96,000 U- Material usage variance
$4,000 F $10,000 U $ 138,000 U- Total materials variance (net)
200,000 220,000 250,000- Products requiring this chemical
The standard called for 1 pound of chemical for each product requiring the specific chemical. Because of the falling prices in the chemical industry, Petty Petroleum generally paid less for chemicals last month than in previous months. The average price paid was $0.40 per pound less than standard chemical X42: it was $0.20 less for chemical AY8 and it was $0.14 greater for chemical 9BZ. All of the chemicals purchased last month were also used during the month.
1- For chemical X42, calculate the number of pounds of material purchased, the standard cost per pound of material and the total standard material cost.
2- For chemical AY8, calculate the number of pounds of material purchased, the standard cost per pound of material and the total standard material cost.
3- For chemical 9BZ, calculate the number of pounds of material purchased, the standard cost per pound of material, and the total standard material cost.
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