Better Blankets,Inc.makes a SnuggieBlank using flannel material and trim binding.They have instituted a successful JIT system and thus no longer have to stock inventory prior to their production need.The Standard Cost Card for The SnuggieBlank model is shown. The company reported the following results concerning January results: The material quantity variance for Flannel used in January is:

Question

Better Blankets,Inc.makes a SnuggieBlank using flannel material and trim binding.They have instituted a successful JIT system and thus no longer have to stock inventory prior to their production need.The Standard Cost Card for The SnuggieBlank model is shown.  The company reported the following results concerning January results:  The material quantity variance for Flannel used in January is:

Quizplus · Accepted Answer

To calculate the material quantity variance, we need to find the difference between the actual quantity used and the standard quantity allowed, multiplied by the standard cost per unit.

Actual Quantity Used = 30,000 yards 
Standard Quantity Allowed = (45,000 SnuggieBlanks x 2 yards per SnuggieBlank) = 90,000 yards 
Difference = Actual Quantity Used - Standard Quantity Allowed 
= 30,000 - 90,000 
= -60,000 yards

(Note: The negative difference means that the actual quantity used is less than the standard quantity allowed)

Standard Cost per unit = $6.00

Material Quantity Variance = Difference x Standard Cost per unit 
= -60,000 x $6.00 
= $-360,000

The material quantity variance is unfavorable because the actual quantity used is less than the standard quantity allowed. The answer is option B.