The following data is given for the stringer Company: Determine the direct mater

Question

The following data is given for the stringer Company:

Determine the direct material quantity variance.

Select the correct answer.

Budgeted production 1,034 units Actual production   913 units Materials:     Standard price per ounce $1.78     Standard pounds per completed unit 10      Actual pounds purchased and used in production 8,856     Actual cost of materials $18,155 Labor:     Standard hourly labor rate $14.00 per hour     Standard hours allowed per completed unit 4.0      Actual labor hours worked 4,701.95     Actual total labor costs $71,705 Overhead:     Actual and budgeted fixed overhead $1,068,974     Standard variable overhead rate $27.00 per standard labor hour      Actual variable overhead costs $131,655 Overhead is applied on standard labor hours.

Explanation / Answer

direct material quantity variance = Std price* (Std qty - Actual quantity) = 1.78*(913*10-8856) = 488 F

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