Spears Manufacturing Company
Spears Manufacturing Company produces beach chairs.Chair frames are all the same size,but can be made from plastic,wood,or aluminum.Regardless of frame choice,the same sailcloth is used for the seat on all chairs.Spears has set a standard for sailcloth of $9.90 per square yard and each chair requires 1 square yard of material.Spears produced 500 plastic chairs,100 wooden chairs,and 250 aluminum chairs during June.The total cost for 1,000 square yards of sailcloth during the month was $10,000.At the end of the month,50 square yards of sailcloth remained in inventory.
Refer to Spears Manufacturing Company.Assuming that there was no sailcloth in inventory at the beginning of June,the unfavorable material quantity variance for the month was

Question

Quizplus · Accepted Answer

The total sailcloth required for production is:
500 plastic chairs × 1 square yard per chair = 500 square yards
100 wooden chairs × 1 square yard per chair = 100 square yards
250 aluminum chairs × 1 square yard per chair = 250 square yards
Total = 850 square yards

Actual sailcloth used in production:
850 square yards – 50 square yards in ending inventory = 800 square yards

The actual cost of sailcloth used in production:
800 square yards × $9.90 per square yard = $7,920

The expected cost of sailcloth used in production:
850 square yards × $9.90 per square yard = $8,415

The unfavorable material quantity variance is:
Expected cost – Actual cost = $8,415 – $7,920 = $495 unfavorable variance

Therefore the correct answer is C.

Spears Manufacturing Company Spears Manufacturing Company Produces Beach Chairs.Chair Frames Are All the Are