# Question

Tercer reports the following on one of its products. Compute the direct materials price and quantity variances.
Direct materials standard (4 lbs. @ \$ 2/ lb.) . . . . . . . . \$ 8 per finished unit
Actual direct materials used . . . . . . . . . . . . . . . . . . . . 300,000 lbs.
Actual finished units produced . . . . . . . . . . . . . . . . . . 60,000 units
Actual cost of direct materials used . . . . . . . . . . . . . . \$ 535,000

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