Dillon has a standard of 1.5 pounds of materials per unit at $6 per pound. In producing 2000 units Dillon used 3100 pounds of materials at a total cost of $18135. Dillon's materials quantity variance is
A) $135 F.
B) $465 U.
C) $600 U.
D) $1050 U.

Question

Quizplus · Accepted Answer

The standard quantity of materials for producing 2000 units is calculated as follows:

1.5 pounds per unit × 2000 units = 3000 pounds

The actual quantity of materials used was 3100 pounds, indicating a unfavorable variance of 100 pounds.

The materials quantity variance can be calculated as follows:

Materials quantity variance = (Standard quantity - Actual quantity) × Standard price 
= (3000 pounds - 3100 pounds) × $6 per pound = $600 U.

Therefore, the correct answer is (C) $600 U.

Dillon Has a Standard of 1