Question

Ingredient	Standard Cost per Batch
Whole tomatoes	$
Vinegar	$
Corn syrup	$
Salt	$
Total	$
Standard unit materials cost per pound	$

b. Determine the direct materials quantity variance for batch K-111. If required, round amounts to the nearest cent. Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number.

Ingredient	Materials Quantity Variance	Favorable/Unfavorable
Whole tomatoes	$
Vinegar	$
Corn syrup	$
Salt	$
Total direct materials quantity variance	$

Standard Product Cost, Direct Materials Variance

Condiments Company uses standards to control its materials costs. Assume that a batch of ketchup (1,200 pounds) has the following standards:

Standard Quantity

Standard Price

Whole tomatoes

2,000

lbs.

$ 0.42

per lb.

Vinegar

110

gal.

$ 2.60

per gal.

Corn syrup

9

gal.

$ 9.30

per gal.

Salt

44

lbs.

$ 2.30

per lb.

The actual materials in a batch may vary from the standard due to tomato characteristics. Assume that the actual quantities of materials for batch K-111 were as follows:

2,100 lbs. of tomatoes

106 gal. of vinegar

10 gal. of corn syrup

43 lbs. of salt

a. Determine the standard unit materials cost per pound for a standard batch. If required, round amounts to the nearest cent.

Ingredient

Standard Cost per Batch

Whole tomatoes

$

Vinegar

$

Corn syrup

$

Salt

$

Total

$

Standard unit materials cost per pound

$

b. Determine the direct materials quantity variance for batch K-111. If required, round amounts to the nearest cent. Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number.

Ingredient

Materials Quantity Variance

Favorable/Unfavorable

Whole tomatoes

$

Vinegar

$

Corn syrup

$

Salt

$

Total direct materials quantity variance

Answer 1

• All working forms part of the answer
• Requirement ‘a’

Ingredient	Unit	per unit	Standard Cost per Batch = ANSWER COLUMN
	[A]	[B]	[C = A x B]
Whole tomatoes	2,000	$                   0.42	$                840.00
Vinegar	110	$                   2.60	$                286.00
Corn syrup	9	$                   9.30	$                   83.70
Salt	44	$                   2.30	$                101.20
Total			$             1,310.90
Standard unit materials cost per pound			$                     1.09 [1310.90 / 1200]

• Requirement ‘b’

Ingredient	Standard Quantity	Actual Quantity	Standard rate per Qty	Materials Quantity Variance	Favorable/Unfavorable
	[A]	[B]	[C]	[D = (B – A) x C]
Whole tomatoes	2,000	2,100	$                     0.42	$                42.00	Unfavourable
Vinegar	110	106	$                     2.60	$              (10.40)	Favourable
Corn syrup	9	10	$                     9.30	$                   9.30	Unfavourable
Salt	44	43	$                     2.30	$                (2.30)	Favourable
Total direct materials quantity variance				$                38.60	Unfavourable