The following data relate to the direct materials cost for the production of 2,300 automobile tires:
Actual: 54,500 lbs. at $1.9 per lb. Standard: 53,400 lbs. at $1.95 per lb. a. Determine the direct materials price variance, direct materials quantity variance, and total direct materials cost variance. Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number.
Direct Materials Price Variance $fill in the blank 1 Favorable/Unfavorable
Direct Materials Quantity Variance $fill in the blank 3 Favorable/Unfavorable
Total Direct Materials Cost Variance $fill in the blank 5 Favorable/Unfavorable
b. The direct materials price variance should normally be reported to the Plant Manager/Purchasing Department
. When lower amounts of direct materials are used because of production efficiencies, the variance would be reported to the Purchasing Department/Production Supervisor
. When the favorable use of raw materials is caused by the purchase of higher-quality raw materials, the variance should be reported to the Purchasing Department/Production Supervisor