Genent Industries,Inc.(GII),developed standard costs for direct material and direct labor.In 2017,GII estimated the following standard costs for one of their major products,the 30-gallon heavy-duty plastic container.

During July,GII produced and sold 4,000 containers using 1,350 pounds of direct materials at an average cost per pound of $48 and 2,450 direct manufacturing labor hours at an average wage of $12.25 per hour.
July's direct material flexible-budget variance is ________.

Question

Genent Industries,Inc.(GII),developed standard costs for direct material and direct labor.In 2017,GII estimated the following standard costs for one of their major products,the 30-gallon heavy-duty plastic container.

During July,GII produced and sold 4,000 containers using 1,350 pounds of direct materials at an average cost per pound of $48 and 2,450 direct manufacturing labor hours at an average wage of $12.25 per hour.
July's direct material flexible-budget variance is ________.

Quizplus · Accepted Answer

Direct material flexible-budget variance = (1,350 × $48)− (4,000 × 0.30 × $50)= $4,800 U