Question

A manufacturing concern which had adopted standard costing furnishes the following information: Standard Material for 70kgs finished products 100kgs Price of material ‡1 per kg Actual Output 2,10,000kgs Materials used 2,80,000kgs Cost of materials 2,52,000 Calculate: i) Material usage variance ii) Material price variance iii) Material cost variance

          A manufacturing concern which had adopted standard costing furnishes the following information:
Standard
Material for 70kgs finished products 100kgs
Price of material ‡1 per kg
Actual
Output 2,10,000kgs
Materials used 2,80,000kgs
Cost of materials 2,52,000

Calculate:
i) Material usage variance
ii) Material price variance
iii) Material cost variance

A manufacturing concern which had adopted standard costing furnishes the following information:
Standard
Material for 70kgs finished products 100kgs
Price of material ‡1 per kg
Actual
Output 2,10,000kgs
Materials used 2,80,000kgs
Cost of materials 2,52,000

Calculate:
i) Material usage variance
ii) Material price variance
iii) Material cost variance

Added by Michael G.

Elementary Statistics a Step by Step Approach

Allan G. Bluman 9th Edition

Instant Answer

Solved by Expert Sri K

12/03/2022

Step 1

Step 1: Calculate Material Usage Variance Material Usage Variance = (Actual Output - Standard Material) * Standard Price Material Usage Variance = (280,000 kgs - 210,000 kgs) * $1/kg Material Usage Variance = 70,000 kgs * $1/kg Material Usage Variance = $70,000 Show more…

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A manufacturing concern which had adopted standard costing furnishes the following information: Standard Material for 70kgs finished products 100kgs Price of material ‡1 per kg Actual Output 2,10,000kgs Materials used 2,80,000kgs Cost of materials 2,52,000 Calculate: i) Material usage variance ii) Material price variance iii) Material cost variance