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2 March, 05:11

Baskets Inc. gathered the following actual results for the current month: Actual amounts: Units produced 5600 Direct materials purchased and used (7800 lbs.) $70,200 Budgeted production and standard costs were: Budgeted production 5300 units Direct materials 2.0 lbs/unit at $3/lb. What is the direct materials quantity variance?

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  1. 2 March, 05:12
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    Direct Material Quantity Variance = $10200 Fav

    Explanation:

    given data

    Units produced = 5600

    Direct materials purchased and used (7800 lbs.) = $70,200

    Budgeted production = 5300 units

    Direct materials 2.0 lbs/unit = $3/lb

    to find out

    direct materials quantity variance

    solution

    we get here Direct Material Quantity Variance that is express as

    Direct Material Quantity Variance = (Standard Quantity - Actual Quantity) * Standard Rate ... 1

    so put here value we get

    Direct Material Quantity Variance = (5600 * 2.0 - 7800) * 3

    Direct Material Quantity Variance = (11200 - 7800) * 3

    Direct Material Quantity Variance = $10200 Fav
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