The per-unit standards for direct materials are 2 gallons at $4 per gallon. Last month 11200 gallons of direct materials that actually cost $42400 were used to produce 6000 units of product. The direct materials quantity variance for last month was
A) $3200 favorable.
B) $2400 favorable.
C) $3200 unfavorable.
D) $5600 unfavorable.

Question

Quizplus · Accepted Answer

The direct materials quantity variance is calculated as the difference between the actual quantity of materials used and the standard quantity of materials allowed, multiplied by the standard price per unit. In this case, the actual quantity of materials used was 11200 gallons, the standard quantity of materials allowed was 12000 gallons (6000 units x 2 gallons per unit), and the standard price per unit was $4. Therefore, the direct materials quantity variance is (11200 - 12000) x $4 = $3200 unfavorable.

The Per-Unit Standards for Direct Materials Are 2 Gallons at $4