Sexson Corporation uses a standard cost system. The following information pertains to direct materials for the month of May. Standard price per lb. $12.00 Actual purchase price per lb. $11.00 Quantity purchased 6,200 lbs. Quantity used 5,900 lbs. Standard quantity allowed for actual output 6,000 lbs. Actual output 1,000 units Sexson reports its material price variances at the time of purchase. What is the standard quantity of direct materials per unit for Sexson Corporation? Group of answer choices 6.00 lbs 7.00 lbs 6.50 lbs 6.20 lbs

Principles of Cost Accounting

17th Edition

ISBN:9781305087408

Author:Edward J. Vanderbeck, Maria R. Mitchell

Publisher:Edward J. Vanderbeck, Maria R. Mitchell

Chapter8: Standard Cost Accounting—materials, Labor, And Factory Overhead

Section: Chapter Questions

Problem 11P: On May 1, Athens Inc. began the manufacture of a new mechanical device known as Snap. The company...

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Sexson Corporation uses a standard cost system. The following information pertains to direct materials for the month of May.

Standard price per lb. $12.00

Actual purchase price per lb. $11.00

Quantity purchased 6,200 lbs.

Quantity used 5,900 lbs.

Standard quantity allowed for actual output 6,000 lbs.

Actual output 1,000 units

Sexson reports its material price variances at the time of purchase.

What is the standard quantity of direct materials per unit for Sexson Corporation?

Group of answer choices

6.00 lbs

7.00 lbs

6.50 lbs

6.20 lbs

Definition Definition System of assigning an estimated cost to the product (instead of the actual cost) so that the product cost can be determined well in advance and the pricing of the product can be done on time. Since the actual cost cannot be predicted at the initial stage of the production process, the estimated cost is recorded in the books. Any deviation of the estimated cost of the actual cost is adjusted in the books at the end of the period.

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