Question

The following data pertains to the direct materials cost for the month of October: Standard costs 5,100 units allowed at $74 each Actual costs 5,150 units input at $62 each What is the direct materials efficiency (quantity) variance? $3,700 unfavorable. $3,100 favorable. $3,100 unfavorable. $3,700 favorable.

Answer 1

Answer:

3,700 unfavorable.

Explanation:

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

std quantity 5100 units

actual quantity 5150 units

std cost  $74.00

difference -50.00 units at $74

efficiency variance  $(3,700.00)

The diference between standard and actual units is negative, the variance is unfavorable.