Majer Corporation makes a product with the following standard costs: The company reported the following results concerning this product in February.
The company applies variable overhead on the basis of direct labor-hours. The direct materials purchases variance is computed when the materials are purchased.
The materials quantity variance for February is:
A) $3,277 F
B) $3,390 U
C) $3,390 F
D) $3,277 U

Question

Majer Corporation makes a product with the following standard costs:  The company reported the following results concerning this product in February.
 The company applies variable overhead on the basis of direct labor-hours. The direct materials purchases variance is computed when the materials are purchased.
The materials quantity variance for February is:
A) $3,277 F 
B) $3,390 U 
C) $3,390 F 
D) $3,277 U

Quizplus · Accepted Answer

SQ = 4,900 units × 6.4 ounces per unit = 31,360 ounces
Materials quantity variance = (AQ - SQ) × SP
= (30,230 ounces − 31,360 ounces) × $3.00 per ounce
= (−1,130 ounces) × $3.00 per ounce
= $3,390 F

Majer Corporation Makes a Product with the Following Standard Costs