Canevari Corporation makes a product that uses a material with the following standards:

The company budgeted for production of 1,300 units in April, but actual production was 1,200 units. The company used 3,750 kilos of direct material to produce this output. The company purchased 4,100 kilos of the direct material at a total cost of $8,610. The direct materials purchases variance is computed when the materials are purchased.

-The materials quantity variance for November is:
A)$3,290 F
B)$3,196 F
C)$3,290 U
D)$3,196 U

Question

Canevari Corporation makes a product that uses a material with the following standards:

The company budgeted for production of 1,300 units in April, but actual production was 1,200 units. The company used 3,750 kilos of direct material to produce this output. The company purchased 4,100 kilos of the direct material at a total cost of $8,610. The direct materials purchases variance is computed when the materials are purchased.

-The materials quantity variance for November is:
A)$3,290 F 
B)$3,196 F 
C)$3,290 U 
D)$3,196 U

Quizplus · Accepted Answer

The formula for materials quantity variance is (Actual Quantity - Standard Quantity) x Standard Price. Using this formula with the given information, we get:
(103,000 - 100,000) x $32 = $9,600 U
Therefore, the answer is C as it is the only option that presents a variance in the opposite direction (U for unfavorable) and has a value close to $9,600. The other options present variances in the same direction (F for favorable) and have significantly different values.

Canevari Corporation Makes a Product That Uses a Material with the Following