The standards for direct materials in making a certain product are 20 pounds at $0.75 per pound. During the past period, 56,000 units of product were made and the materials quantity variance was $30,000 U. The number of pounds of direct material used during the period amounted to:
A)1,080,000
B)1,160,000
C)1,200,000
D)784,000

Question

Quizplus · Accepted Answer

The materials quantity variance is calculated as (Actual Quantity - Standard Quantity) x Standard Price. Given the variance is $30,000 U (unfavorable), we can set up the equation: (Actual Quantity - 56,000 units x 20 pounds) x $0.75 = $30,000. Solving for Actual Quantity gives 1,160,000 pounds.

The Standards for Direct Materials in Making a Certain Product