San francisco corporation uses two materials in the...

San Francisco Corporation uses two materials in the production of its product. The materials, X and Y, have the following standards: Material Standard Mix Standard Unit Price Standard Cost X 3,500 units $1.00 per unit $3,500 Y 1,500 units 3.00 per unit $4,500 Yield 4,000 units During April, the following actual production information was provided: Material Actual Mix X 30,000 units Y 20,000 units Yield 36,000 units What is the materials usage variance?

Transcript

00:01 Now in the question, san francisco corporation, they are using two materials for their product.

00:13 Now, namely material x and material y.

00:19 Now, the standard for these material usage is given to be, material x is required 3 ,500 units for 4 ,000, of final product and material y is required 1 ,500 units for 4 ,000 units of final product.

00:57 These are the standard given to us.

01:00 Now what we will be first doing is we will be calculating the per unit requirements.

01:05 So per unit requirement, these are the standard.

01:16 Therefore for material x 3 ,500 units are required for 4 ,000 units of final product therefore per unit requirement comes to 0 .875 per unit is the requirement.

01:41 And for material y, the standard requirement per unit will be for 4 ,000 final product, 1500 units are required so this gives us 0 .375 is required for one unit of final product now we have the standard requirement now let's see what is the actual unit of production given now the actual yield was of total 36 ,000 that means 36 ,000 of units of final products were produced now now for this the actual quantity used is given to us.

02:28 So actual quantity of materials that is x has been used 30 ,000 units and y has been used 20 ,000 units.

02:49 So these are the actual quantity of material used.

02:54 Now for calculating the material uses variance, we also need to find out the state.

02:59 Standard quantity requirement for the actual product.

03:04 So now what we will be doing? we will be calculating the standard quantity required for actual yield.

03:23 That is for 36 ,000 units.

03:26 So we know that the requirement of material x is going to be how much per unit requirement is of 0 .875...

Question

Please give Ace some feedback