Question

The actual cost of direct materials is​ $13.00 per pound. The standard cost per pound is​ $8.75. During the current​ period, 9,900 pounds of direct materials were used in production and​ 18,500 pounds were purchased. The standard quantity of direct materials for actual units produced is​ 16,200 pounds. How much is the direct materials quantity​ variance?

Answer 1

Answer:

quantity variance  $55,125.00

Explanation:

$(standard\:quantity-actual\:quantity) \times standard \: cost = DM \: quantity \: variance$

std quantity           16,200.00

actual quantity     9,900.00

std cost                           $8.75

difference             6,300.00

$(16,200-9,900) \times 8.75 = DM \: quantity \: variance$

quantity variance  $55,125.00

The difference between actual and standard is positive. The variance is favorable, the company used less pounds that expected.

We multiply the saved pound by the standard cost per pound to get the total variance.