The planning budget for March was based on producing and selling 25,000 units. However, during March the company actually produced and sol 30,000 units and incurred the following costs:

inputs	Standard quantity or hours (1)	standard price or rate (2)	standard cost (1)*(2)
Direct materials	5 pounds	$8.00 per pound	40
direct labor	2 hours	$14 per hours	28
variable overhead	2 hours	$5 per hours	$10
total standard cost per unit			78
The planning budger for march was based on producing and selling 25000 units. However, during March the company actually produced and sold 30,000 units and incurred the
following costs:
a) purchased 160,00 pounds of raw materials at a cost of $7.50 per pound. All of this material was used in production.
b) diret laborers worked 55,000 hours at a rate of $15.00 per hour.
c) Total variable manufacturing overhead for the month was $280,500.

2. What raw material Cost would be included in the company's Flexible budget for march?

3. What is the materials price variance for March?

4. What is the materials quantity variance for march?

2)	Raw materials included in flexible budget:
	Actual units produced
	Raw materials allowed/unit
	Total raw materials allowed
	Cost of raw materials/unit
	Cost of raw materials included in flexible budget
3)	Materials Price Variance:
	AQ( AP - SP)
	Actual price of materials/ pound (a)
	Standard price of materials/ pound (b)
	Variance (a) -(b) = (c )
	Actual quantity of raw materials used (pounds) (d)
	*Materials price variance (c ) x (d)
	* If actual price paid is greater than standard price allowed,
	the material price variance would be unfavorable and vice versa.
4)	Materials Quantity Variance:
	SP (AQ - SQ)
	Standard quantity of materials allowed:
	Actual units produced (a)
	Standard quantity allowed per unit (b)
	Total quantity allowed (c )
	Actual quantity of materials used (d)
	**Materials Quantity Variance
	** If actual quantity of materials used exceed standard quantity of materials allowed,
	materials quantity variance would be unfavorable and vice versa.