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Standard Product Cost, Direct Materials Variance

H.J. Heinz Company uses standards to control its materials costs. Assume that a batch of ketchup (1,600 pounds) has the following standards:

	Standard Quantity		Standard Price
Whole tomatoes	2,700	lbs.	$ 0.48	per lb.
Vinegar	150	gal.	2.9	per gal.
Corn syrup	13	gal.	10.7	per gal.
Salt	60	lbs.	2.7	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-111 were as follows:

2,800 lbs. of tomatoes

144 gal. of vinegar

14 gal. of corn syrup

59 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-111. 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
Vinegar
Corn syrup
Salt
Total direct materials quantity variance

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