Question

The following information is available for Chad’s Chocolates:

Actual production......... 2,800 boxes
Budgeted production...... 3,200 boxes
Direct Materials
Standard ............ 1.5 pounds of chocolate per box @ $8.00 per pound
Actual ............ 6,000 pounds purchased @ $7.70 per pound
............... 5,040 pounds used @ $7.70 per pound

Required

a. Calculate the direct materials price and quantity variances.
b. What might have caused the variances you calculated?



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  • CreatedFebruary 21, 2014
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