Beakins Corporation produces a single product. The standard cost card for the product follows: During a recent period the company produced 1,200 units of product. Various costs associated with the production of these units are given below: The company records all variances at the earliest possible point in time. Variable manufacturing overhead costs are applied to products on the basis of standard direct labor-hours. The materials quantity variance for the period is:
A)$950 U
B)$5,000 F
C)$1,000 U
D)$6,000 F

Question

Beakins Corporation produces a single product. The standard cost card for the product follows:  During a recent period the company produced 1,200 units of product. Various costs associated with the production of these units are given below:  The company records all variances at the earliest possible point in time. Variable manufacturing overhead costs are applied to products on the basis of standard direct labor-hours. The materials quantity variance for the period is:
A)$950 U 
B)$5,000 F 
C)$1,000 U 
D)$6,000 F

Quizplus · Accepted Answer

Materials quantity variance = (Actual quantity used - Standard quantity allowed) x Standard price

Actual quantity used = 31,000 lbs 
Standard quantity allowed = 30,000 lbs (1,200 units x 25 lbs per unit) 
Standard price = $3.10 per lb

Materials quantity variance = (31,000 - 30,000) x $3.10 = $3,100 U

Therefore, the correct answer is C) $1,000 U.

Beakins Corporation Produces a Single Product