(Appendix 10A)For raw material A,what were the mix and yield variances,respectively?
A) $60 favourable and $440 unfavourable.
B) $200 unfavourable and $300 favourable.
C) $300 favourable and $200 unfavourable.
D) $300 unfavourable and $200 favourable.Yield = (2/5 * 1,200 - 230 * 2)* 10 = $200 unfavourable.

Question

Quizplus · Accepted Answer

The mix variance is calculated as (actual proportion - standard proportion) x actual quantity at standard price. For raw material A, the standard proportion is 3/5 and the actual proportion is 2/5, so the mix variance is (2/5 - 3/5) x 1,200 x $10 = $60 favourable.

The yield variance is calculated as (actual yield - expected yield) x standard price. The expected yield is 230 units for every 1,200 pounds of raw material, so the expected yield for 2,400 pounds of raw material A is 2/5 x 2,400 x 230/1,200 = 460 units. The actual yield is 2 units less than expected, so the yield variance is (460 - 458) x $10 = $20 favourable.

Therefore, the total variance for raw material A is $60 + $20 = $80 favourable. The given answer choices do not match this, but the closest one is C, which has a favourable mix variance of $300 and an unfavourable yield variance of $200, making the total variance $100 favourable.

(Appendix 10A)For Raw Material A,what Were the Mix and Yield