Johnny Corporation makes a product that uses a material with the following standards:

The company budgeted for production of 9,500 units in April, but actual production was 9,600 units. The company used 85,400 kilos of direct material to produce this output. The company purchased 91,900 kilos of the direct material at $1.10 per kilo.

The direct materials purchases variance is computed when the materials are purchased.

-The materials quantity variance for April is:
A)$7,348 U
B)$6,680 U
C)$6,680 F
D)$7,348 F

Question

Johnny Corporation makes a product that uses a material with the following standards:

The company budgeted for production of 9,500 units in April, but actual production was 9,600 units. The company used 85,400 kilos of direct material to produce this output. The company purchased 91,900 kilos of the direct material at $1.10 per kilo.

The direct materials purchases variance is computed when the materials are purchased.

-The materials quantity variance for April is:
A)$7,348 U 
B)$6,680 U 
C)$6,680 F 
D)$7,348 F

Quizplus · Accepted Answer

SQ = 9,600 units F1F1F1S1F1F1F10 8.2 kilos per unit = 78,720 kilos
Materials quantity variance = (AQ - SQ)SP
= (85,400 kilos - 78,720 kilos)$1.00 per kilo
= (6,680 kilos)$1.00 per kilo = $6,680 U

Johnny Corporation Makes a Product That Uses a Material with the Following