Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Ring World produces class rings. Its best-selling model has a direct materials standard of 9 grams of a special alloy per ring This special alloy

image text in transcribed
image text in transcribed
image text in transcribed
Ring World produces class rings. Its best-selling model has a direct materials standard of 9 grams of a special alloy per ring This special alloy has a standard cost of $65.90 per gram In the past month, the company purchased 9,700 grams of this alloy at a total cost of $635,350 A total of 9,500 grams were used last month to produce 1,000 rings. Read the requirements Requirements 1. What is the actual cost per gram of the special alloy that Ring World purchased last month? 2. What is the direct material price variance? 3. What is the direct material quantity variance? 4. How might the direct material price variance for the company last month be causing the direct material quantity variance? Requirement 1. What is the actual cost per gram of the special alloy that your answer to the nearest cent.) Ring World purchased last month? (Round The actual cost per gram of the special alloy that Ring world purchased last month is $ Requirement 2. What is the direct material price variance? (Abbreviations used: DM - Direct materials) Begin by determining the formula for the price variance, then compute the price variance for direct materials. (Enter the variance as a positive number. Round interim calculations to the nearest cent and your variance amount to the nearest whole dollar. Label the variance as favorable (F) or unfavorable (U).) x x DM price variance Requirement 3. What is the direct material quantity variance? (Abbreviations used: DM Direct materials) Determine the formula for the quantity variance, then compute the quantity variance for direct materials. (Enter the variance as a positive number. Round interim calculations to the nearest cent and your variance amount to the nearest whole dollar. Label the variance as favorable (F) or unfavorable (U).) DM quantity variance x Requirement 4. How might the direct material price variance for the company last month be causing the direct material quantity variance? The direct material price variance might mean that Ring world purchased a As a result, the company alloy than the standard allows. This accounts for the quantity (efficiency) variance

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Accounting What The Numbers Mean

Authors: David Marshall, Wayne McManus, Daniel Viele

8th Edition

0073379417, 978-0073379418

More Books

Students also viewed these Accounting questions