The Thompson Company uses standard costing and has established the following direct material and direct labor standards for each unit of Lept.

Direct materials: 2 gallons at $4 per gallon
Direct labor: 0.5 hours at $8 per hour

During September, the company made 6,000 Lepts and incurred the following costs:

Direct materials purchased: 13,400 gallons at $4.10 per gallon
Direct materials used: 12,600 gallons
Direct labor used: 2,800 hours at $7.65 per hour

-The materials quantity variance for September was:
A)$2,460 unfavorable
B)$5,600 unfavorable
C)$2,400 unfavorable
D)$5,740 unfavorable

Question

The Thompson Company uses standard costing and has established the following direct material and direct labor standards for each unit of Lept.

Direct materials: 2 gallons at $4 per gallon
Direct labor: 0.5 hours at $8 per hour

During September, the company made 6,000 Lepts and incurred the following costs:

Direct materials purchased: 13,400 gallons at $4.10 per gallon
Direct materials used: 12,600 gallons
Direct labor used: 2,800 hours at $7.65 per hour

-The materials quantity variance for September was:
A)$2,460 unfavorable
B)$5,600 unfavorable
C)$2,400 unfavorable
D)$5,740 unfavorable

Quizplus · Accepted Answer

SQ = 6,000 units F1F1F1S1F1F1F10 2 gallons per units = 12,000 gallons
Materials quantity variance = (AQ - SQ)SP
= (12,600 gallons - 12,000 gallons)$4.00 per gallon
= (600 gallons)$4.00 per gallon = $2,400 U

The Thompson Company Uses Standard Costing and Has Established the Following