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18 January, 17:35

The actual cost of direct materials is $10.50 per pound. The standard cost per pound is $11.75. 42) During the current period 10,000 pounds were used in production and 11,500 pounds werepurchased. The standard quantity for actual units produced is 9,900 pounds. The direct materials efficiency variance is:A) $1,175 favorable

B) $16,800 unfavorable

C) $1,175 unfavorable

D) $1,050 favorable

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  1. 18 January, 19:18
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    Direct materials efficiency variance = 1175 unfavorable

    so correct option is C) $1,175 unfavorable

    Explanation:

    given data

    actual cost = $10.50 per pound

    standard cost per pound = $11.75

    current period = 10,000 pounds

    purchased = 11,500 pounds

    actual units produced = 9,900 pounds

    to find out

    direct materials efficiency variance

    solution

    we get here Direct materials efficiency variance that is express as

    Direct materials efficiency variance = Standard rate * (Standard quantity - Actual quantity) ... 1

    put here value in equation 1 and we get

    Direct materials efficiency variance = 11.75 * (10000 - 9900)

    Direct materials efficiency variance = 11.75 * 100

    Direct materials efficiency variance = 1175 unfavorable

    so correct option is C) $1,175 unfavorable
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