The San Jose Corporation uses two materials in the production of its product. The materials, G and H, have the following standards: During June, the following actual production information was provided:
What is the materials yield variance?
A) $6,000 (
B) $6,000 (
C) $18,000 (
D) $18,000 (

Question

The San Jose Corporation uses two materials in the production of its product. The materials, G and H, have the following standards:  During June, the following actual production information was provided:
 What is the materials yield variance?
A) $6,000 (
B) $6,000 (
C) $18,000 (
D) $18,000 (

Quizplus · Accepted Answer

Materials yield variance = (Standard yield - Actual yield) × Standard price
Standard yield = 500 kg of G × 2 L/kg = 1000 L
500 kg of H × 3 L/kg = 1500 L
Total Standard yield = 2500 L
Actual yield = 2400 L (2000 L + 400 L)
Therefore, (2500 L - 2400 L) × $6/L = $6,000 (U).

The San Jose Corporation Uses Two Materials in the Production