Question

In: Accounting

Under normal conditions, Sarah spends $8.40 per unit of materials, and it will take 3.6 units...

Under normal conditions, Sarah spends $8.40 per unit of materials, and it will take 3.6 units of material per pair of shoes. During July, Sole Purpose Shoe Company incurred actual direct materials costs of $62,010 for 6,890 units of direct materials in the production of 2200 pairs of shoes.

Complete the table below showing the direct materials variance relationships for July for Sole Purpose Shoe Company. If required, round your answers to two decimal places. When entering variances, use a negative number for a favorable cost variance, and a positive number for an unfavorable cost variance.

Actual Quantity: 6,890
Actual Cost:
Actual Price:

Direct Materials:

Actual Quanitity: 6,890
Total Direct Materials:

Standard price:
Direct Materials:

Standard Quantity:
Standard Cost:
Standard Price:

Solutions

Expert Solution

Actual Quantity: 6,890

Actual Cost:$62,010

Actual Price:$9

Direct Materials:

Actual Quanitity: 6,890

Total Direct Materials:

Standard price:$8.40

Direct Materials

Standard Quantity:7920 units

Standard Cost:$66,528

Standard Price:$8.40

Standard DATA for

2200

Pairs

Quantity (SQ)

Rate (SR)

Standard Cost

[A]

[B]

[A x B]

Direct Material

( 3.6UNITS OF MATERIAL x 2200 Pairs)=7920UNITS OF MATERIAL

$          8.40

$ 66,528.00

Actual DATA for

2200

Pairs

Quantity (AQ)

Rate (AR)

Actual Cost

Direct Material

6890

$   9.00

$ 62,010.00

Standard DATA for

2200

Pairs

Quantity (SQ)

Rate (SR)

Standard Cost

Direct Material

7920

$ 8.40

$ 66,528.00

Material Price Variance

(

Standard Rate

-

Actual Rate

)

x

Actual Quantity

(

$ 8.40

-

$ 9.00

)

x

6890

4134

Variance

$4,134.00

Unfavourable-U

Material Quantity Variance

(

Standard Quantity

-

Actual Quantity

)

x

Standard Rate

(

7920

-

6890

)

x

$   8.40

-8652

Variance

- $ 8,652.00

Favourable-F

Material Spending Variance

(

Standard Cost

-

Actual Cost

)

(

$             66,528.00

-

$   62,010.00

)

-4518

Variance

- $ 4,518.00

Favourable-F


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