The following information is for direct material cost for X Company for 2016: Bu

Question

The following information is for direct material cost for X Company for 2016: Budgeted pounds per unit of product Budgeted cost per pound Budgeted production Actual pounds per unit of product Actual cost per pound Actual production 2.9 $13.80 5,470 units 2.6 $14.00 5,190 units 1. What was the direct material static budget for 2016? $218,909 You are correct Your receipt no. is 152-2988 Previous Tries 2. what was the direct material flexible budget variance for 2016 (a positive number means a favorable variance; a negative number means an unfavorable variance)?29993 Submit Answer Incorrect. Tries 1/2 Previous Tries

Explanation / Answer

Answer:-1)- Direct material static budget for 2016= Budgeted production*Budgeted pounds per unit*Budgeted cost per pound

=(5470 units*2.9 pound per unit)*$13.80 per pound

=15863 pounds*$13.80 per pound

=$218909

2)-Direct material flexible budget variance for 2016:-

              = Standard cost of material – Actual cost of material

              = $207704 - $188916 = $18788 Favourable

Where:-

Standard cost of material=Actual production*Budgeted pounds per unit*Budgeted cost per pound

=(5190 units*2.9 pound per unit)*$13.80 per pound

=15051 pound*$13.80 per pound

=$207704

Actual cost of material= Actual production*Actual pounds per unit*Actual cost per pound

=(5190 units*2.6 pound per unit)*$14.00 per pound

=13494 pound*$14.00 per pound

=$188916

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