Question

The per-unit standards for direct materials are 2 pounds at $5 per pound. Last month, 11,200 pounds of direct materials that actually cost $53,000 were used to produce 6,000 units of product. The direct materials quantity variance for last month was
$7,000 unfavorable.

$4,000 favorable.

$4,000 unfavorable.

$3,000 favorable.

Answer 1

Answer:

$4,000 favorable.

Explanation:

The computation of the material quantity variance is shown below:

= Standard Price × (Standard Quantity - Actual Quantity)

= $5 per pound × (2 pound × 6,000 units - 11,200)

= $5 per pound  × (12,000 - 11,200)

=$5 per pound × 800

= $4,000 favorable

Since the standard quantity is higher than the actual quantity so the variance should be favorably otherwise unfavorable