Paw-Paw Products
Paw-Paw Products produces and sells flannel covered dogbeds. In the current year, Paw-Paw had expected to sell 8000 beds but actually produced and sold 8500 beds. The following information is available regarding the standard cost to produc
In the current year, 44 000 metres of material were purchased and used at a cost of $1.60 per metre and 365 500 direct labour minutes were incurred at a cost of $.23 per minute.
-The company's direct material usage variance for the current year was:
A) $3750 U
B) $2250 U
C) $6000 U
D) $6650 U

Question

Quizplus · Accepted Answer

The direct material usage variance is calculated as the difference between the actual quantity of materials used and the standard quantity allowed for the actual production, multiplied by the standard cost per unit of material. The standard quantity allowed for 8500 beds (assuming a standard usage rate not provided in the question, but necessary for calculation) was exceeded by the actual usage of 44,000 meters, resulting in an unfavorable variance. Without the standard usage rate per bed, the exact calculation process can't be detailed, but the correct answer based on the provided options is $2250 unfavorable, indicating that more material was used than planned for the production of 8500 beds.

Paw-Paw Products Paw-Paw Products Produces and Sells Flannel Covered Dogbeds. in the in the Current