Question 1

Middle School Inc produces granite grave stones. Each monument typically requires 300 pounds of granite. The standard cost for granite is estimated at $150 per ton (2,000 pounds). During a recent month, 200 monuments were constructed. The company purchased and used 25 tons of material at a cost of $175 per ton.

Requirement:

Compute the total variance for materials, and determine how much is related to price and how much is related to quantity.

Question 2

Beyond Reasonable Doubts (BRD) Incorporated uses a standard cost system, and calculates and records variances related to direct materials and direct labor. The following information was available for March:

Purchases of raw materials