Bowing International purchased 66,000 metres (cost = $514,800) of direct material to be used in the manufacture of the company's sole product. According to the production specifications, each completed unit requires five metres of direct material at a standard cost of $8.00 per metre. Direct materials consumed by the end of the period totalled 63,500 metres in the manufacture of 12,933 finished units. An examination of Bowing's payroll records revealed that the company worked 23,000 labour hours (cost = $333,500) during the period, and specifications called for each completed unit requiring two hours of labour at a standard cost of $14.60 per hour.
Bowing's direct-material price variance is:

Question

Quizplus · Accepted Answer

The Answer of Bowing International purchased 66,000 metres (cost = $514,800) of direct material to be used in the manufacture of the company's sole product. According to the production specifications, each completed unit requires five metres of direct material at a standard cost of $8.00 per metre. Direct materials consumed by the end of the period totalled 63,500 metres in the manufacture of 12,933 finished units. An examination of Bowing's payroll records revealed that the company worked 23,000 labour hours (cost = $333,500) during the period, and specifications called for each completed unit requiring two hours of labour at a standard cost of $14.60 per hour.
Bowing's direct-material price variance is:

Bowing International Purchased 66,000 Metres (Cost = $514,800) of Direct