Serenity Equestrian Corporation produces high-quality leather saddles. The company has a standard cost system and has set the following standards for materials and labour:
During the year, Serenity Equestrian Corporation produced 150 saddles. Actual leather purchased was 3,100 strips at $12 per strip. There were no beginning or ending inventories of leather. Actual direct labour was 2,500 hours at $16 per hour.
$\begin{array}{lll}
\text {Leather (20 strips@ $ \$ 15 $ per strip)}&\$300\
\text {Direct labour ( 15 hours $ @ \$ 15 $ per hour) }&225\
\text {Total prime cost }&\$252\
\end{array}$

-Refer to the Figure.What are the materials price variance and the materials usage variance,respectively?
A)$9,000 U and $1,200 F
B)$9,000 F and $1,200 U
C)$9,300 U and $1,500 F
D)$9,300 F and $1,500 U

Question

Serenity Equestrian Corporation produces high-quality leather saddles. The company has a standard cost system and has set the following standards for materials and labour:
During the year, Serenity Equestrian Corporation produced 150 saddles. Actual leather purchased was 3,100 strips at $12 per strip. There were no beginning or ending inventories of leather. Actual direct labour was 2,500 hours at $16 per hour.
 $\begin{array}{lll}
\text {Leather (20 strips@ $ \$ 15 $ per strip)}&\$300\
\text {Direct labour ( 15 hours $ @ \$ 15 $ per hour) }&225\
\text {Total prime cost  }&\$252\
\end{array}$

-Refer to the Figure.What are the materials price variance and the materials usage variance,respectively?
A)$9,000 U and $1,200 F
B)$9,000 F and $1,200 U
C)$9,300 U and $1,500 F
D)$9,300 F and $1,500 U

Quizplus · Accepted Answer

The Answer of Serenity Equestrian Corporation produces high-quality leather saddles. The company has a standard cost system and has set the following standards for materials and labour:
During the year, Serenity Equestrian Corporation produced 150 saddles. Actual leather purchased was 3,100 strips at $12 per strip. There were no beginning or ending inventories of leather. Actual direct labour was 2,500 hours at $16 per hour.
 $\begin{array}{lll}
\text {Leather (20 strips@ $ \$ 15 $ per strip)}&\$300\
\text {Direct labour ( 15 hours $ @ \$ 15 $ per hour) }&225\
\text {Total prime cost  }&\$252\
\end{array}$

-Refer to the Figure.What are the materials price variance and the materials usage variance,respectively?
A)$9,000 U and $1,200 F
B)$9,000 F and $1,200 U
C)$9,300 U and $1,500 F
D)$9,300 F and $1,500 U

Serenity Equestrian Corporation Produces High-Quality Leather Saddles -Refer to the Figure