Arrow Industries uses a standard cost system in which direct materials inventory is carried at standard cost. Arrow has established the following standards for the prime costs of one unit of product. During May, Arrow purchased 160,000 pounds of direct material at a total cost of $304,000. The total direct labor wages for May were $37,800. Arrow manufactured 19,000 units of product during May using 142,500 pounds of direct material and 5,000 direct labor-hours.
-The direct materials quantity variance for May is:
A)$14,400 unfavorable
B)$1,100 favorable
C)$17,100 unfavorable
D)$17,100 favorable

Question

Arrow Industries uses a standard cost system in which direct materials inventory is carried at standard cost. Arrow has established the following standards for the prime costs of one unit of product.  During May, Arrow purchased 160,000 pounds of direct material at a total cost of $304,000. The total direct labor wages for May were $37,800. Arrow manufactured 19,000 units of product during May using 142,500 pounds of direct material and 5,000 direct labor-hours.
-The direct materials quantity variance for May is:
A)$14,400 unfavorable 
B)$1,100 favorable 
C)$17,100 unfavorable 
D)$17,100 favorable

Quizplus · Accepted Answer

SQ = 19,000 units F1F1F1S1F1F1F10 8 pounds per unit = 152,000 pounds
Materials quantity variance = (AQ - SQ)SP
= (142,500 pounds - 152,000 pounds)$1.80 per pound
= (-9,500 pounds)$1.80 per pound = $17,100 F

Arrow Industries Uses a Standard Cost System in Which Direct