Answer:
Actual Quantity 1500 pounds
Materials price variance $ 1500 Favorable
Explanation:
Shoemaker Perkins Company
Given
Each unit requires 2 pounds of materials X15 at standard.
Standard cost is $10 per pound
Actual Cost $ 9 per pound
Actual No of Units Manufactured = 600
Standard Quantity allowed= 600* 2= 1200 pounds
Materials Usage Variance = $3000 unfavorable
<em>We find the actual quantity by putting the values from the given data in the formula of material quantity variance which is also called material usage variance.</em>
Formula
a. Material Quantity Variance= (Standard Price * Actual Quantity)-(Standard Price * Standard Quantity)
$3000= $ 10*Actual Quantity- $ 10 * 1200
$3000= $ 10*Actual Quantity- 12000
$3000 + 12000= $ 10*Actual Quantity
$ 10*Actual Quantity=15000
Actual Quantity= 15000/10= 1500 pounds
<em>Now the Materials price variance can be calculated by putting the values in the formula of Materials price variance .</em>
b.Materials price variance = (Actual Price * Actual Quantity)- (Standard Price * Actual Quantity)
Materials price variance =( $ 9 *1500)- ($10* 1500)
Materials price variance = 13500- 15000= $ 1500 Favorable
<em>It is favorable because the standard price is more than the actual price.</em>
