The following data is given for the Stringer Company: 914 units Budgeted product

Question

The following data is given for the Stringer Company: 914 units Budgeted production Actual production Materials: 1,075 units Standard price per ounce Standard ounces per completed unit Actual ounces purchased and used in production Actual price paid for materials 12 13,287 $27,238 Labor: Standard hourly labor rate Standard hours allowed per completed unit Actual labor hours worked Actual total labor costs $14.73 per hour 4.3 5,536.25 $84,428 Overhead: Actual and budgeted fixed overhead $1,070,000 $28.00 per standard labor hour $155,015 Standard variable overhead rate Actual variable overhead costs Overhead is applied on standard labor hours. Round your final answer to the nearest dollar. Do not round interim calculations. The direct materials price variance is Oa. $3,720.36 favorable Ob. $3,720.36 unfavorable Oc. $9,300.9 unfavorable Od. $9,300.9 favorable Previous Next

Explanation / Answer

Std Price of material per ounce : $ 1.77 Actual price ppaid per ounce (27238/13287): $ 2.05 per ounce Actual Qty purchased and used: 13287 ounces Material Price variance: Actual Qty (Std price-Actual Price) 13287 (1.77 - 2.05) = $ 3720.01 Unfavorable Answer is b. $ 3720.36 Unfavorable

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