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Acme Brick Company Uses the Following Rule to Determine Whether

Question 123

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Acme Brick Company uses the following rule to determine whether materials usage variances should be investigated:
A materials usage variance will be investigated when the variance is greater than either $5,000 or 10 percent of the standard cost.
During June,the company purchased and used 9,500 pounds of concrete for $5 per pound.It was able to make 20,000 bricks.Its standard quantity of materials allowed is 0.45 pound of concrete per brick at a standard price of $6 per pound.
Acme Brick Company uses the following rule to determine whether materials usage variances should be investigated: A materials usage variance will be investigated when the variance is greater than either $5,000 or 10 percent of the standard cost. During June,the company purchased and used 9,500 pounds of concrete for $5 per pound.It was able to make 20,000 bricks.Its standard quantity of materials allowed is 0.45 pound of concrete per brick at a standard price of $6 per pound.

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