Ask Question
3 October, 13:45

Direct Materials Variances Silicone Engine Inc. produces wrist-worn tablet computers. The company uses Thin Film Crystal (TFC) LCD displays for its products. Each tablet uses one display. The company produced 580 tablets during December. However, due to LCD defects, the company actually used 600 LCD displays during December. Each display has a standard cost of $15.00. Six hundred LCD displays were purchased for December production at a cost of $8,550. Determine the price variance, quantity variance, and total direct materials cost variance for December. Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number. Price variance $ Quantity variance $ Total direct materials cost variance $

+2
Answers (1)
  1. 3 October, 13:54
    0
    The price variance is - $450 favorable

    The quantity variance is $300 unfavorable

    The Total direct materials cost variance is - $150 favorable

    Explanation:

    According to given data we have the following:

    standard price=$15

    Actual price=$8,550/600=$14.25

    standard quantity=580

    Actual quantity=600

    To calculate the price variance, quantity variance, and total direct materials cost variance for December we would have to make the following calculations:

    price variance = (Actual price-standard price) * Actual quantity

    price variance = ($14.25-$15) * 600

    price variance=-$450 favourable

    quantity variance = (Actual quantity-standard quantity) * standard price

    quantity variance = (600-580) * $15

    quantity variance=$300 unfavorable

    total direct materials cost variance=materials price variance+material quantity variance

    total direct materials cost variance=-$450+$300

    total direct materials cost variance=-$150
Know the Answer?
Not Sure About the Answer?
Find an answer to your question 👍 “Direct Materials Variances Silicone Engine Inc. produces wrist-worn tablet computers. The company uses Thin Film Crystal (TFC) LCD displays ...” in 📗 Business if the answers seem to be not correct or there’s no answer. Try a smart search to find answers to similar questions.
Search for Other Answers