A company uses the following standard costs to produce a single unit of output. ...
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Accounting
A company uses the following standard costs to produce a single unit of output.
| Direct materials | 6 pounds at $0.90 per pound = | $ 5.40 |
|---|---|---|
| Direct labor | 0.5 hour at $12.00 per hour = | $ 6.00 |
| Manufacturing overhead | 0.5 hour at $4.80 per hour = | $ 2.40 |
During the latest month, the company purchased and used 58,000 pounds of direct materials at a price of $1.00 per pound to produce 10,000 units of output. Direct labor costs for the month totaled $56,350 based on 4,900 direct labor hours worked. Variable manufacturing overhead costs incurred totaled $15,000 and fixed manufacturing overhead incurred was $10,400. Based on this information, the direct materials quantity variance for the month was:
Multiple Choice
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$5,800 unfavorable
-
$1,000 favorable
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$1,800 unfavorable
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$5,800 favorable
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$1,800 favorable
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