The following data relate to direct materials costs for November: What is the direct materials quantity variance?
A) $3,600 favorable
B) $1,240 favorable
C) $3,600 unfavorable
D) $1,240 unfavorable

Question

The following data relate to direct materials costs for November:  What is the direct materials quantity variance?
A) $3,600 favorable 
B) $1,240 favorable 
C) $3,600 unfavorable 
D) $1,240 unfavorable

Quizplus · Accepted Answer

To calculate the direct materials quantity variance, we need to use the following formula:

DMQV = (Actual Quantity - Standard Quantity) x Standard Price

Using the provided data, we have:

Actual Quantity = 19,500 lbs
Standard Quantity = 20,740 lbs
Standard Price = $0.70/lb

DMQV = (19,500 - 20,740) x $0.70
DMQV = -1,240

The negative variance indicates that the actual quantity used was less than the standard quantity, which is favorable. Therefore, the answer is D, $1,240 favorable.

The Following Data Relate to Direct Materials Costs for November