Using the standard costs of $5 per pound for a 10 pound bag of chocolate and the following actual cost and usage data,compute the direct materials quantity variance. $$\begin{array} { l l }
\text { Direct materals purchased and used } & 99,000 \text { pounds } \
\text { Price paid for direct materials } & \$ 4.00 \text { per pound } \
\text { Number of eood urits produced } & 9,000 \text { urits }
\end{array}$$

Question

Using the standard costs of $5 per pound for a 10 pound bag of chocolate and the following actual cost and usage data,compute the direct materials quantity variance. $$\begin{array} { l l } 
\text { Direct materals purchased and used } & 99,000 \text { pounds } \
\text { Price paid for direct materials } & \$ 4.00 \text { per pound } \
\text { Number of eood urits produced } & 9,000 \text { urits }
\end{array}$$

Quizplus · Accepted Answer

To calculate the direct materials quantity variance, we need to use the following formula: (Actual Quantity Used - Standard Quantity Allowed) x Standard Price per Unit. 
Actual Quantity Used = 8,000 pounds 
Standard Quantity Allowed = 10,000 pounds 
Standard Price per Unit = $5 
(8,000 - 10,000) x $5 = -$10,000 or $10,000 (U)

Since the actual quantity used was less than the standard quantity allowed, the quantity variance is favorable (U). Therefore, the correct answer is option B.

Using the Standard Costs of $5 Per Pound for a 10