The following data relate to direct materials costs for February:
Materials cost per yard: standard, $2.00; actual, $2.10
Yards per unit: standard, 4.5 yards; actual, 4.75 yards
Units of production: 9,500
-The total direct materials cost variance is
A)$9,262.50 unfavorable
B)$9,262.50 favorable
C)$3,780.00 unfavorable
D)$3,562.50 favorable

Question

Quizplus · Accepted Answer

The total direct materials cost variance is calculated by comparing the standard cost of materials to the actual cost incurred. The standard cost for the materials needed for production is calculated as (standard cost per yard) * (standard yards per unit) * (units of production) = $2.00 * 4.5 yards * 9,500 units = $85,500. The actual cost incurred is (actual cost per yard) * (actual yards per unit) * (units of production) = $2.10 * 4.75 yards * 9,500 units = $94,762.50. The variance is $94,762.50 - $85,500 = $9,262.50 unfavorable, because the actual cost exceeds the standard cost.

The Following Data Relate to Direct Materials Costs for February