Materials and Labor Variances Direct Materials Price and Quantity Variances Juni

Question

Materials and Labor Variances Direct Materials Price and Quantity Variances Junior Company produces one product with the following standard costs Direct materlais (3 pounds $2.50) $7.50 Direct labor (1.4 hours o $12) 16.80 Duing the year, Junior prodaced 10,300 units using 30,000 pounds of material costing $2.40 per pound. Direct labor worked 15,600 hours for total wages of $187,200 1. The direct materials price variance is$ (choose one). pounds. The direct materials quantity variance is (choose one). Now make the follewing changes to the tnteractive Graph. 3. Change the actual direct materials cost per pound to S260. The direct materials price variance becomes The direct materials quantity becomes 4. Change the actual direct materials used (in pounds) from 30,000 to 42,000 The diredt materials price variance becomes The direct materials quantity becomes Continue to change the actual direct materials used and the actual cost per pound to determine how the changes impact the direct materials price variance and the direct materials quantity variance

Explanation / Answer

Req 1: Actual output: 10300 units Std qty: 30900 pounds Std price per pound: $ 2.50 per pound actual qty: 30,000 pounds Actual price: $ 2.40 per pound Material price variance: Actual qty (Std price -Actual price) 30000 (2.50-2.40) = 3000 F Req 2: Std quantoty (10300 units @ 3 pounds) : 30900 pounds Material quantity variance = Std price (Std quantity-Actual quantity). 2.50 (30900-30000) = $ 2250 F Req 3: Material price variance= Actual quantity (Std price-Actua price) 30000 (2.50-2.60) = 3000 U Material Quantity variance $ 2250 F (remain same) Req 4: material Price variance = Actual quantity (Std price -Actual price) 42000 (2.50-2.60)= 4200 U Material Quantity variance = Std price (Std quantity-Actual quantity) 2.50 (30900-42000)= $ 27,750 U

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