Logo
Home Study Material Contact Search
AI Chat FREE
  1. business
  2. accounting
  3. balt company maintains a standard cost system; as

Balt Company maintains a standard cost system; as such, all inventories, including materials, are carried on...

Free

90.2K

Verified Solution

Question

Accounting

Balt Company maintains a standard cost system; as such, allinventories, including materials, are carried on the books atstandard cost. Last period, Balt used 6,000 pounds of Material H toproduce 850 units of Product C8. The company has established astandard of 7 pounds of Material H per unit of C8, at a price of$7.25 per pound of material. During the period, Balt purchased4,000 pounds of Material H. The company spent $27,000 during theperiod to purchase material H.


Required:

1. Calculate the direct materials purchase-price variance forthe period, rounded to the nearest dollar. (U or F)
2. Calculate the direct materials usage variance for the period,rounded to the nearest whole dollar. (U or F)

Answer & Explanation Solved by verified expert
3.8 Ratings (417 Votes)

  • [1]

Material Purchase Price Variance

(

Standard Rate

-

Actual Rate = $27000 / 4000 pounds

)

x

Actual Quantity purchased

(

$                               7.25

-

$                       6.75

)

x

4000

2000

Variance

$              2,000.00

Favourable-F

  • [2]

Material Usage Variance

(

Standard Quantity = 850 units x 7 pounds

-

Actual Quantity used

)

x

Standard Rate

(

5950

-

6000

)

x

$                           7.25

-362.5

Variance

$                  362.50 or $ 363

Unfavourable-U

Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:
  • Unlimited Question Access with detailed Answers
  • Zin AI - 3 Million Words
  • 10 Dall-E 3 Images
  • 20 Plot Generations
  • Conversation with Dialogue Memory
  • No Ads, Ever!
  • Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
Become a Member

Other questions asked by students

Q

Given the similar quadrilaterals 116 73 6 What is the value of y A 166...

Geometry
Q

You are a commercial real.estte broker, eager to sell an office building. An investor is interested...

Finance
Q

The median US salary is $50,700, according to US Census data. Using a one-sample t-test, test to...

Basic Math
Q

Find the absolute maxima and minima for f(x) on the interval [a, b]. f(x) = x3 − 2x2 − 4x +...

Basic Math
Q

Do you think other people have prejudices about sexuality? Where do you think such prejudices come...

Psychology
Q

A piston–cylinder assembly contains 2 lb of water, initially at 100 lbf/in.2 and 600°F. The water...

Mechanical Engineering
Q

Contrast experimental with quasi-experimental methods; generally speaking, which methods are most useful?

Psychology
Q

Find A, B, C, D, E such that the rule Af(a ? 2h) + Bf(a...

Advance Math
Q

How does the expression of genes result in variations among cells O A When genes...

Biology
Q

An analysis of the amount of fiber in grams and the potassium content in milligrams...

Statistics
Q

Calendar year Parent Co acquired all of the stock of Sub Co on January 1,...

Accounting
Q

Assume the Hiking Shoes division of the Simply Shoes Company had the following results last...

Accounting