• The corporate office had budgeted Dunkin' Donuts Coffee Shop to sell 6,000 iced coffees during the week beginning January 15. Each iced coffee was expected to contain 10 ounces of ice. During the week of January 15, the shop actually sold 6,500 iced coffees and used 65,000 ounces of ice. The standard cost of ice is $0.10 per ounce. The variance report from company headquarters showed an unfavorable materials usage variance of $50.
• Required:
  1. Verify the correctness of the variance calculation. If incorrect, provide the correct calculation.
  2. Offer three independent explanations for the materials usage variance discovered in Requirement 1.