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Direct Materials Variances
Tip Top Corp. produces a product that requires six standard gallons per unit. The standard price is $3.5 per gallon. If 4,600 units required 26,500 gallons, which
were purchased at $3.64 per gallon, what is the direct materials (a) price variance, (b) quantity variance, and (c) cost variance? Enter a favorable variance as a
negative number using a minus sign and an unfavorable variance as a positive number.
a. Direct materials price variance
b. Direct materials quantity variance
c. Direct materials cost variance