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Standard Product Cost, Direct Materials Variance

Condiments Company uses standards to control its materials costs. Assume that a batch of ketchup (2,000 pounds) has the following standards:

	Standard Quantity		Standard Price
Whole tomatoes	3,300	lbs.	$ 0.39	per lb.
Vinegar	190	gal.	2.40	per gal.
Corn syrup	16	gal.	8.70	per gal.
Salt	76	lbs.	2.20	per lb.

The actual materials in a batch may vary from the standard due to tomato characteristics. Assume that the actual quantities of materials for batch K-54 were as follows:

3,400 lbs. of tomatoes

182 gal. of vinegar

17 gal. of corn syrup

75 lbs. of salt

a. Determine the standard unit materials cost per pound for a standard batch. If required, round amounts to the nearest cent.

Ingredient	Standard Cost per Batch
Whole tomatoes	$
Vinegar	$
Corn syrup	$
Salt	$
Total	$
Standard unit materials cost per pound	$

b. Determine the direct materials quantity variance for batch K-54. If required, round amounts to the nearest cent. Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number.

Ingredient	Materials Quantity Variance	Favorable/Unfavorable
Whole tomatoes	$	SelectFavorableUnfavorableItem 8
Vinegar	$	SelectFavorableUnfavorableItem 10
Corn syrup	$	SelectFavorableUnfavorableItem 12
Salt	$	SelectFavorableUnfavorableItem 14
Total direct materials quantity variance	$	SelectFavorableUnfavorable Item 16

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