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E$7-24.$ DM variances Bell Inc. manufactures a product that requires five pounds of material. The pur$-$

chasing agent has an opportunity to purchase the necessary material at a vendor's bankruptcy

sale at $$1\mathrm{.}40$ per pound rather than the standard cost of $$2\mathrm{.}10$ per pound. The purchasing agent

purchases $100,000$ pounds of material on May $31.$ During the next four months, the company's

production and material usage was as follows:

a$.$ What is the material price variance for this purchase?

b$.$ What is the material quantity variance for each month for this material?

c$.$ What might be the cause of the unfavorable material quantity variances? DM variances Bell Inc. manufactures a product that requires five pounds of material. The purchasing agent has an opportunity to purchase the necessary material at a vendor's bankruptcy sale at $$1\mathrm{.}40$ per pound rather than the standard cost of $$2\mathrm{.}10$ per pound. The purchasing agent purchases $100,000$ pounds of material on May $31.$ During the next four months, the company's production and material usage was as follows: Note: Round all of your final answers below to the nearest whole dollar. a$.$ What is the material price variance for this purchase? Note: Do not use a negative sign with your answer. Material price variance $ b$.$ What is the material quantity variance for each month for this material? Note: Do not use a negative sign with your answers.

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