Cost system. The company has established the following standard for the materials costs of one unit of product: Standard Standard Quantity 6.0 pounds Standard Cost $45.60 Price $7.60/pound uring April, the company purchased 171,000 pounds of direct material at a total cost of $1,316,700. The company anufactured 31,000 units of product during April using 187,240 pounds of direct materials. What is the materials price ariance for April? (Do not round intermediate calculations.) ur instructor has provided the following variance formulas for you: rect Materials Variances aterials Price Variance: aterials Quantity Variance: AQ(AP - SP) SP(AQ - SQ)
Cost system. The company has established the following standard for the materials costs of one unit of product: Standard Standard Quantity 6.0 pounds Standard Cost $45.60 Price $7.60/pound uring April, the company purchased 171,000 pounds of direct material at a total cost of $1,316,700. The company anufactured 31,000 units of product during April using 187,240 pounds of direct materials. What is the materials price ariance for April? (Do not round intermediate calculations.) ur instructor has provided the following variance formulas for you: rect Materials Variances aterials Price Variance: aterials Quantity Variance: AQ(AP - SP) SP(AQ - SQ)
Cornerstones of Cost Management (Cornerstones Series)
4th Edition
ISBN:9781305970663
Author:Don R. Hansen, Maryanne M. Mowen
Publisher:Don R. Hansen, Maryanne M. Mowen
Chapter9: Standard Costing: A Functional-based Control Approach
Section: Chapter Questions
Problem 28P: Haversham Corporation produces dress shirts. The company uses a standard costing system and has set...
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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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