Barb Bubbletop (BB)produces bangles.Each bangle requires 0.25 pounds of bronze which should cost $16 per pound.In August,BB purchased 12,000 pounds of bronze at $15 per pound.In the month,41,000 bangles were made,and 11,000 pounds of bronze were used.Which is false of BB's materials variances?

Question

Quizplus · Accepted Answer

A) The company should have spent $176,000 on materials, calculated as 12,000 pounds * $16 per pound.B) The bronze inventory increased by 1,000 pounds, not by $15,000. The increase in inventory value is 1,000 pounds * $15 per pound = $15,000, which is true, making the original statement false in the context of this question.C) The materials quantity variance is calculated based on the actual quantity used versus the standard quantity allowed for actual production. The standard quantity for 41,000 bangles is 41,000 bangles * 0.25 pounds/bangle = 10,250 pounds. The actual quantity used was 11,000 pounds, so the variance is 750 pounds * $16 per pound = $12,000 unfavorable, not $18,000.D) The materials price variance is calculated based on the difference between the actual price paid per pound and the standard price, multiplied by the actual quantity purchased. The variance is (15 - 16) * 12,000 = -$12,000, which is favorable, not unfavorable.

Barb Bubbletop (BB)produces Bangles