Sloop Pennyfeather Limited budgeted a total spend of £12 600 on raw materials for December 20X6: 6 kg at a standard price of £3.50 x 600 units. The budget outturn was that 610 units were sold.These were each produced using 6.5kg of raw materials at a price of £3.30 per kg.
What was the materials quantity variance for December 20X6?

Question

Quizplus · Accepted Answer

The materials quantity variance is calculated as (Actual Quantity - Standard Quantity) x Standard Price. The standard quantity for 610 units is 610 x 6 kg = 3660 kg. The actual quantity used is 610 x 6.5 kg = 3965 kg. The variance is (3965 kg - 3660 kg) x £3.50 = £1067.50 (A).

Sloop Pennyfeather Limited Budgeted a Total Spend of £12 600