AutoZone produces brake pads using a standard cost system. Each break pad requires a standard quantity of 6 components, and the standard cost is $8 per component. In April, AutoZone produced 8,900 brake pads, and 65,900 components were purchased and used at the total cost of $523,500. Two requirements: a. Compute the direct materials price variance. b. Compute the direct materials quantity variance. a. Compute the direct materials price variance. (Do not round your intermediate calculations. Indicate "Favorable", "Unfavorable", or "None" for no effect (I.e., zero variance).) Price Variance b. Compute the direct materials quantity variance. (Do not round your intermediate calculations. Indicate "Favorable", "Unfavorable", or "None" for no effect (i.e., zero variance)-). Quantity Variance
AutoZone produces brake pads using a standard cost system. Each break pad requires a standard quantity of 6 components, and the standard cost is $8 per component. In April, AutoZone produced 8,900 brake pads, and 65,900 components were purchased and used at the total cost of $523,500. Two requirements: a. Compute the direct materials price variance. b. Compute the direct materials quantity variance. a. Compute the direct materials price variance. (Do not round your intermediate calculations. Indicate "Favorable", "Unfavorable", or "None" for no effect (I.e., zero variance).) Price Variance b. Compute the direct materials quantity variance. (Do not round your intermediate calculations. Indicate "Favorable", "Unfavorable", or "None" for no effect (i.e., zero variance)-). Quantity Variance
Managerial Accounting
15th Edition
ISBN:9781337912020
Author:Carl Warren, Ph.d. Cma William B. Tayler
Publisher:Carl Warren, Ph.d. Cma William B. Tayler
Chapter9: Evaluating Variances From Standard Costs
Section: Chapter Questions
Problem 3PA: Direct materials, direct labor, and factory overhead cost variance analysis Mackinaw Inc. processes...
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Concept explainers
Variance Analysis
In layman's terms, variance analysis is an analysis of a difference between planned and actual behavior. Variance analysis is mainly used by the companies to maintain a control over a business. After analyzing differences, companies find the reasons for the variance so that the necessary steps should be taken to correct that variance.
Standard Costing
The standard cost system is the expected cost per unit product manufactured and it helps in estimating the deviations and controlling them as well as fixing the selling price of the product. For example, it helps to plan the cost for the coming year on the various expenses.
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