Direct Materials Variances The following data relate to the direct materials cost for the production of 1,800 automobile tires: Actual: 60,000 lbs. at $1.95 per lb. Standard: 58,200 lbs. at $1.90 per lb. a. Determine the direct materials price variance, direct materials quantity variance, and total direct materials cost variance. Enter a favorable variance as a number using a minus sign and an unfavorable variance as a positive number. Direct Materials Price Variance Direct Materials Quantity Variance Total Direct Materials Cost Variance . When lower amounts of direct materials are used because b. The direct materials price variance should normally be reported to the production efficiencies, the variance would be reported to the quality raw materials, the variance should be reported to the When the favorable use of raw materials is caused by the purchase of
Direct Materials Variances The following data relate to the direct materials cost for the production of 1,800 automobile tires: Actual: 60,000 lbs. at $1.95 per lb. Standard: 58,200 lbs. at $1.90 per lb. a. Determine the direct materials price variance, direct materials quantity variance, and total direct materials cost variance. Enter a favorable variance as a number using a minus sign and an unfavorable variance as a positive number. Direct Materials Price Variance Direct Materials Quantity Variance Total Direct Materials Cost Variance . When lower amounts of direct materials are used because b. The direct materials price variance should normally be reported to the production efficiencies, the variance would be reported to the quality raw materials, the variance should be reported to the When the favorable use of raw materials is caused by the purchase of
Managerial Accounting
15th Edition
ISBN:9781337912020
Author:Carl Warren, Ph.d. Cma William B. Tayler
Publisher:Carl Warren, Ph.d. Cma William B. Tayler
Chapter9: Evaluating Variances From Standard Costs
Section: Chapter Questions
Problem 3PB: Direct materials, direct labor, and factory overhead cost variance analysis Road Gripper Tire Co....
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Variance Analysis
In layman's terms, variance analysis is an analysis of a difference between planned and actual behavior. Variance analysis is mainly used by the companies to maintain a control over a business. After analyzing differences, companies find the reasons for the variance so that the necessary steps should be taken to correct that variance.
Standard Costing
The standard cost system is the expected cost per unit product manufactured and it helps in estimating the deviations and controlling them as well as fixing the selling price of the product. For example, it helps to plan the cost for the coming year on the various expenses.
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