Question
Tommy's Toys produces two types of toys: trains and dolls. Tommy's uses stainless steel to manufacture the trains and plastic to manufacture the dolls. Information
Tommy's Toys produces two types of toys: trains and dolls. Tommy's uses stainless steel to manufacture the trains and plastic to manufacture the dolls. Information regarding the usage of steel and plastic for the past year follows:
Product Names | Steel | Plastic |
Direct materials information | ||
Standard pounds per unit | 3 lb. | 1.5 lb. |
Standard Price (SP) per pound | $3.50 | ? |
Actual Quantity (AQ) used per unit | 2.0 lbs. | 3.00 lbs. |
Actual Price (AP) paid for material | $2.75 | $3.25 |
Actual Quantity Purchased (AQP) and used | 2,500 lbs. | 1,000 lbs. |
Price variance | ? | $2,500 F |
Quantity variance | $1400 U | ? |
Flexible budget variance | ? | $1,937 F |
Number of units produced | 400 | 500 |
What is the direct materials flexible budget variance for steel used to manufacture the trains?
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