Question
Standard Product Cost, Direct Materials Variance H.J. Heinz Company uses standards to control its materials costs. Assume that a batch of ketchup (2,200 pounds) has
Standard Product Cost, Direct Materials Variance
H.J. Heinz Company uses standards to control its materials costs. Assume that a batch of ketchup (2,200 pounds) has the following standards:
Standard Quantity | Standard Price | |||
Whole tomatoes | 3,700 | lbs. | $ 0.49 | per lb. |
Vinegar | 200 | gal. | 3 | per gal. |
Corn syrup | 17 | gal. | 10.9 | per gal. |
Salt | 80 | lbs. | 2.7 | per lb. |
The actual materials in a batch may vary from the standard due to tomato characteristics. Assume that the actual quantities of materials for batch K-111 were as follows:
3,800 lbs. of tomatoes |
192 gal. of vinegar |
18 gal. of corn syrup |
79 lbs. of salt |
a. Determine the standard unit materials cost per pound for a standard batch. If required, round amounts to the nearest cent.
Ingredient | Standard Cost per Batch |
Whole tomatoes | $fill in the blank 1 |
Vinegar | $fill in the blank 2 |
Corn syrup | $fill in the blank 3 |
Salt | $fill in the blank 4 |
Total | $fill in the blank 5 |
Standard unit materials cost per pound | $fill in the blank 6 |
b. Determine the direct materials quantity variance for batch K-111. If required, round amounts to the nearest cent. Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number.
Ingredient | Materials Quantity Variance | Favorable/ Unfavorable |
Whole tomatoes | $fill in the blank 7 | |
Vinegar | $fill in the blank 9 | |
Corn syrup | $fill in the blank 11 | |
Salt | $fill in the blank 13 | |
Total direct materials quantity variance | $fill in the blank 15 |
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