The standard cost of Product B manufactured by Pharrell Company of Product B, in

Question

The standard cost of Product B manufactured by Pharrell Company of Product B, includes 3.2 27,000 units units of direct materials at $6.6 per unit. During June, 27,000 units of direct materials are purchased at a cost of $6.45 per unit, and of direct materials are used to produce 8,300 units Compute the total materials variance and the price and quantity variances. Total materials varianco Materials price varience Materials quantity variance Compute the total materials variance and the price and quantity variances, assuming the purchase price is $6.70 and the quantity purchased and used is 27,000 units Total materials variance Materials price variance Materials quantity variance

Explanation / Answer

Answer to A

Answer to B

Total Material Cost Variance = Standard Cost - Actual Cost                                                  = 8300 x 3.2 x 6.6 - 27000 x 6.45                                                  = 175296 - 174150                                                  = 1146 Fav Direct Material Price Variance = (Standard Rate - Actual Rate) x Actual Quantity                                                              = ( 6.60 - 6.45 ) x 27000                                                              = 4050 Fav Direct Material Quantity Variance = (Standard Quantity - Actual Quantity) x Standard Rate                                                              = ( 8300 x 3.2 - 27000 ) x 6.6                                                              = 2904 Unfav

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