The standard cost of Product B manufactured by Almed Company includes two units of direct materials at $4.00 per unit. During June, 27,000 units of direct materials are purchased at a cost of $3.80 per unit, and 27,000 units of direct materials are used to produce 13,000 units of Product B.

Instructions

(a) Compute the total materials variance and the price and quantity variances.

(b) Repeat (a), assuming the purchase price is $4.20 and the quantity purchased and used is 25,200 units.