QS 23-8 Materials variances LO P2

Tercer reports the following for one of its products.

Direct materials standard (3 lbs. @ $3 per lb.)	$	9		per finished unit
Actual direct materials used (AQ)		270,000		lbs.
Actual finished units produced		71,000		units
Actual cost of direct materials used	$	742,500

AQ = Actual Quantity SQ = Standard Quantity AP = Actual Price SP = Standard Price

Compute the direct materials price and quantity variances and classify each as favorable or unfavorable.

Actual Cost			0				0	Standard Cost
		0
			$0	0			$0
				$0
				0