Waterways Corporation uses very stringent standard costs in evaluating its manufacturing efficiency. These standards are not ideal at this point, but the management is working toward that as a goal. At present, the company uses the following standards.

Materials
Item	Per unit			Cost
Metal		1 lb.			63 per lb.
Plastic		12 oz.			$1.00 per lb.
Rubber		4 oz.			88 per lb.
Direct labor
Item	Per unit			Cost
Labor		15 min.			$8.00 per hr.
Predetermined overhead rate based on direct labor hours = $4.28

The January figures for purchasing, production, and labor are:

The company purchased 229,000 pounds of raw materials in January at a cost of 78 a pound.

Production used 229,000 pounds of raw materials to make 115,500 units in January.

Direct labor spent 18 minutes on each product at a cost of $7.80 per hour.

Overhead costs for January totaled $54,673 variable and $73,800 fixed.

What is the Materials Quantity Variance? Is it Favorable, Unfavorable, or Neither?

Question 1 Waterways Corporation uses very stringent standard costs in evaluating its manufacturing efficiency. These standards are not "ideal" at this point, but the management is working toward that as a goal. At present, the company uses the following standards. Materials Item Cost Per unit 63c per lb. Metal 1 lb Plastic $1.00 per lb 12 oz. Rubber 88c per lb 4 oz Direct labor Item Per unit Cost Labor 15 min. $8.00 per hr. Predetermined overhead rate based on direct labor hours $4.28 The January figures for purchasing, production, and labor are: The company purchased 229,000 pounds of raw materials in January at a cost of 78c a pound. Production used 229,000 pounds of raw materials to make 115,500 units in January Direct labor spent 18 minutes on each product at a cost of $7.80 per hour. overhead costs for January totaled $54,673 variable and $73,800 fixed