Question

Devoto Inc. has provided the following data concerning one of the products in its standard cost system.
Inputs Standard Quantity or Hours per Unit of Output Standard Price or Rate
Direct materials 6.6 grams $7.70 per gram
The company has reported the following actual results for the product for June:
Actual output 9,200 units
Raw materials purchased 64,500 grams
Actual cost of raw materials purchased $ 548,250
Raw materials used in production 60,710 grams
The raw materials quantity variance for the month is closest to:________.
a. $77 U
b. $85 F
c. $85 U
d. $77 F

Answer 1

Answer:

Direct material quantity variance= $77 favorable

Explanation:

Giving the following information:

Direct materials 6.6 grams $7.70 per gram

Actual output 9,200 units

Raw materials used in production 60,710 grams

To calculate the direct material quantity variance, we need to use the following formula:

Direct material quantity variance= (standard quantity - actual quantity)*standard price

Direct material quantity variance= (9,200*6.6 - 60,710)*7.7

Direct material quantity variance= (60,720 - 60,710)*7.7

Direct material quantity variance= $77 favorable