Results for Desserts by Jacki's pie crust information for last quarter was as follows Actual production in pies18,000 piesStandard cost for pie crust6 ounces × $0.09 per ounceActual cost for pie crust$10,890 for 99,000 ounces Desserts by Jacki's direct material efficiency variance for pie crusts was Blank______.Multiple choice question.$810 unfavorable$990 unfavorable$810 favorable$990 favorable
Question
Results for Desserts by Jacki's pie crust information for last quarter was as follows Actual production in pies18,000 piesStandard cost for pie crust6 ounces × 10,890 for 99,000 ounces Desserts by Jacki's direct material efficiency variance for pie crusts was Blank______.Multiple choice question.990 unfavorable990 favorable
Solution
To calculate the direct material efficiency variance, we need to follow these steps:
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Calculate the standard quantity of material for the actual production: The standard cost for pie crust is 6 ounces per pie. So, for 18,000 pies, the standard quantity would be 18,000 pies * 6 ounces/pie = 108,000 ounces.
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Calculate the actual quantity of material used: The actual cost for pie crust was $10,890 for 99,000 ounces. So, the actual quantity used was 99,000 ounces.
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Calculate the variance: The variance is the difference between the standard quantity and the actual quantity, multiplied by the standard cost per unit. Variance = (Standard quantity - Actual quantity) * Standard cost per unit Variance = (108,000 ounces - 99,000 ounces) * 0.09 per ounce Variance = $810
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Determine if the variance is favorable or unfavorable: If the actual quantity is less than the standard quantity, the variance is favorable because less material was used than expected. If the actual quantity is more than the standard quantity, the variance is unfavorable because more material was used than expected. In this case, the actual quantity (99,000 ounces) is less than the standard quantity (108,000 ounces), so the variance is favorable.
So, Desserts by Jacki's direct material efficiency variance for pie crusts was $810 favorable.
Similar Questions
Results for Desserts by Jacki's labor costs for pies last quarter was as follows Actual production in pies18,000 piesStandard labor cost per pie3/4 hour × $12.50 per hourActual labor cost for pies$135,000 for 9,000 hours Desserts by Jacki's direct labor price variance for pies was Blank______.Multiple choice question.$33,750 unfavorable$22,500 unfavorable$33,750 favorable$22,500 favorable
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