Quinn Company's master budget called for 30,000 units of production.Budgeted direct material costs at this level were $450,000 or $15 per unit.Quinn actually produced 32,000 units and incurred direct material costs of $496,000.Quinn uses flexible budgeting to evaluate variances and determined that there was a $16,000 unfavorable direct materials variance.All of the following reasons could have contributed to the flexible budget variance except:

Question

Quizplus · Accepted Answer

Producing more than the master budget called for would result in a favorable volume variance. Therefore, it could not have contributed to the unfavorable direct materials variance. B and C could have contributed to the unfavorable direct materials variance as they relate to the cost and quantity of direct materials used.

Quinn Company's Master Budget Called for 30,000 Units of Production