Candy Stores Inc.gives you the following information: The standard material cost is $7 per pound for a 15 pound bag of chocolate.The following is the actual cost and usage data:
Using the above information provided for Candy Stores.
-Compute the direct materials quantity variance for Candy Stores.

Question

Candy Stores Inc.gives you the following information: The standard material cost is $7 per pound for a 15 pound bag of chocolate.The following is the actual cost and usage data:
 Using the above information provided for Candy Stores.
-Compute the direct materials quantity variance for Candy Stores.

Quizplus · Accepted Answer

To calculate the direct materials quantity variance, we use the formula:

DMQV = (Standard Quantity - Actual Quantity) x Standard Price

Standard Quantity = 15 pounds
Standard Price = $7/pound

Actual Quantity = 12,000 pounds (as given in the table)

DMQV = (15 - 12,000/1,000) x 7 
DMQV = (15 - 12) x 7 
DMQV = 21

Since the actual quantity used is less than the standard quantity, the DMQV is unfavorable (U), so the answer is B.