A company uses the following standard costs to produce a single unit of output. Direct materials6 pounds at $0.90 per pound=$5.40 Direct labor0.5 hour at $12.00 per hour=$6.00 Manufacturing overhead0.5 hour at $4.80 per hour=$2.40 During the latest month, the company purchased and used 58,000 pounds of direct materials at a price of $1.00 per pound to produce 10,000 units of output. Direct labor costs for the month totaled $56,350 based on 4,900 direct labor hours worked. Variable manufacturing overhead costs incurred totaled $15,000 and fixed manufacturing overhead incurred was $10,400. Based on this information, the total direct materials cost variance for the month was:
A. $5,800 favorable
B. $4,000 favorable
C. $4,000 unfavorable
D. $1,800 favorable
E. $5,800 unfavorable
Answer: C
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A. 0.949 B. 0.930 C. 0.980 D. 0.930
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What will be an ideal response?
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