Dirsct Materials variance

Direct Materials Variances OBJ. 3 - Compute and interpret direct materials and direct labor variances. EE 23-1 Encinas Company produces a product that requires 6 standard pounds per unit. The standard price is $1.75 per pound. If 2,300 units required 13,400 pounds, which were purchased at $2.00 per pound, what is the direct materials (a) price variance, (b) quantity variance, and (c) total direct materials cost variance? 200-1.75 -0.25 x 13.400 - 3350 13400 - 13800 = -400 x 1.75 = "700 Total = 2650 Favorable PE 23-2A