Valenzuela Plastics, Inc. has set a standard cost, ₱5.25 per unit for Material D and ₱12.25 per unit for Material E. In June, Valenzuela bought 17,500 units of Material D and 8,750 units of Material E. All Material D, except 1,400 units, were bought at the standard unit cost. The 1,400 units had a unit cost of ₱6.15. Valenzuela bought 7,875 units of Material E at standard cost and 875 units at a unit cost of ₱14. In accordance with the standard, two units of Material D and one unit of Material E should be used to make each unit of Product F. In January, 7,000 units of Product F were made, and 15,050 units of Material D were used and 7,175 units of Material E were used. 1. What is the materials price variance? 2. What is the materials mix variance? 3. What is the materials yield variance?
Valenzuela Plastics, Inc. has set a
unit for Material E. In June, Valenzuela bought 17,500 units of Material D and 8,750 units of Material E.
All Material D, except 1,400 units, were bought at the standard unit cost. The 1,400 units had a unit cost
of ₱6.15. Valenzuela bought 7,875 units of Material E at standard cost and 875 units at a unit cost of
₱14.
In accordance with the standard, two units of Material D and one unit of Material E should be
used to make each unit of Product F. In January, 7,000 units of Product F were made, and 15,050 units
of Material D were used and 7,175 units of Material E were used.
1. What is the materials price variance?
2. What is the materials mix variance?
3. What is the materials yield variance?
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