Reelmates manufactures fishing poles.In a recent month,the company budgeted production of 2,000 poles.Actual production was 2,200.According to the standard cost card,each pole requires 3 feet of fiberglass rod at a cost of $9 per foot.Reelmates used 6,500 feet of rod at a net cost of $65,000 for the period. The material usage variance was:

Question

Quizplus · Accepted Answer

The standard quantity of fiberglass rod required for 2,000 poles is 6,000 feet (2,000 poles x 3 feet per pole). The actual quantity used was 6,500 feet. The difference between the actual and standard quantities is 500 feet (6,500 feet - 6,000 feet). The cost of the variance is $9 per foot x 500 feet = $4,500. Since the actual quantity used was greater than the standard quantity, the variance is unfavorable.

Reelmates Manufactures Fishing Poles