15.00 points Perfect Pet Collar Company makes custom leather pet collars. The co

Question

15.00 points Perfect Pet Collar Company makes custom leather pet collars. The company expects each collar to require 2.25 feet of leather and predicts leather will cost $4.00 per foot. Suppose Perfect Pet made 75 collars during February. For these 75 collars, the company actually averaged 2.30 feet of leather per collar and paid $3.60 per foot. Required: 1. Calculate the standard direct materials cost per unit. (Round your answer to 2 decimal places.) per Collar 2. Without performing any calculations, determine whether the direct materials price variance will be favorable or unfavorable. Price Vari 3. Without performing any calculations, determine whether the direct materials quantity variance will be favorable or unfavorable

Explanation / Answer

1.

Standard direct materials cost per collar = 2.25 feet * 4 per foot = 9

2.

Direct material price variance is favourable (as actual price paid per foot is lesser than standard)

3.

Direct material quantity variance is unfavourable (as actual quantity used per collar is higher than standard)

6.

69 Favourable

[75*2.3(3.6-4)]

15 Unfavourable

[4*{(75*2.3)-(75*2.25)}]

Direct material price variance Actual quantity*(Actual price-Standard price)

69 Favourable

[75*2.3(3.6-4)]

Direct material quantity variance Standard price*(Actual quantity-Standard quantity)

15 Unfavourable

[4*{(75*2.3)-(75*2.25)}]

Related Questions

Navigate

• Browse (All)
• Browse 1
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.