Standard Direct Materials Cost per Unit from Variance Data The following data re

Question

Standard Direct Materials Cost per Unit from Variance Data The following data relating to direct materials cost for November of the current year are taken from the records of Play Tyme Inc., a manufacturer of plastic toys: Quantity of direct materials used 7,500 lbs. Actual unit price of direct materials $4.00 per lb. Units of finished product manufactured 1,795 units. Standard direct materials per unit of finished product 4 lbs. Direct materials quantity variance unfavorable $1,376 Direct materials price variance favorable $2,250 Determine the standard direct materials cost per unit of finished product, assuming that there was no inventory of work process at either the beginning or the end of the month. If required, round your standard cost per unit answer to two decimal places. Product finished units Standard finished product for direct materials used units Deficiency of finished product for materials used units Standard cost for direct materials $ per units

Explanation / Answer

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

                    (1376)         =       (SQ - 7500) * 4.3

                   SQ = 7820

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

                        2250           =     (SP- 4 ) *7500

                      SP = 4.3

Product finished    =   7180

Standard finished product for direct material used = 7820

deficiency of finished product for material used = 640

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