The standard direct material cost per unit for Willis Group was $152 (= $38 per gallon × 4 gallons per unit). During the period, actual direct materials costs amounted to $2,020,690, materials used totaled 55,475 gallons, and 13,270 units were produced. Required: Compute the direct materials price and efficiency variances for the period. Note: Indicate the effect of each variance by selecting "F" for favorable, or "U" for unfavorable. If there is no effect, do not select either option.

The standard direct material cost per unit for Willis Group was $152 (= $38 per gallon × 4 gallons per unit). During the period, actual direct materials costs amounted to $2,020,690, materials used totaled 55,475 gallons, and 13,270 units were produced. Required: Compute the direct materials price and efficiency variances for the period. Note: Indicate the effect of each variance by selecting "F" for favorable, or "U" for unfavorable. If there is no effect, do not select either option.

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Description: The standard direct material cost per unit for Willis Group was $152 (= $38 per gallon × 4 gallons per unit). During the period, actual direct materials costs amounted to $2,020,690, materials used totaled 55,475 gallons, and 13,270 units were produc

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter18: Pricing And Profitability Analysis

Section: Chapter Questions

Problem 33P

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Compute the direct materials price and efficiency variances for the period.

Note: Indicate the effect of each variance by selecting "F" for favorable, or "U" for unfavorable. If there is no effect, do not select either option.

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