H.J. Heinz Company uses standards to control its materials costs. Assume that a batch of ketchup (3,128
Question:
H.J. Heinz Company uses standards to control its materials costs. Assume that a batch of ketchup (3,128 pounds) has the following standards:
| Standard Quantity | Standard Price | ||
Whole tomatoes | 4,000 | lbs. | $ 0.60 | per lb. |
Vinegar | 260 | gal. | 2.25 | per gal. |
Corn syrup | 25 | gal. | 28.00 | per gal. |
Salt | 100 | lbs. | 2.25 | 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:
4,250 lbs. of tomatoes
275 gal. of vinegar
22 gal. of corn syrup
90 lbs. of salt
a. Determine the standard unit materials cost per pound for a standard batch. Round the per unit answer to the nearest whole 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. 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 |
Tomatoes | $ | |
Vinegar | $ | |
Corn syrup | $ | |
Salt | $ | |
Total direct materials quantity variance | $ | |
Accounting
ISBN: 978-0324662962
23rd Edition
Authors: Jonathan E. Duchac, James M. Reeve, Carl S. Warren