Question

Hart Company made 3,220 bookshelves using 22,220 board feet of wood costing $293,304. The company's direct materials standards for one bookshelf are 8 board feet of wood at $13.10 per board foot. AQ = Actual Quantity SQ = Standard Quantity AP = Actual Price SP = Standard Price

(1) Compute the direct materials price and quantity variances and classify each as favorable or unfavorable

. (2) Hart applies management by exception by investigating direct materials variances of more than 5% of actual direct materials costs. Which direct materials variances will Hart investigate further?

Compute the direct materials price and quantity variances and classify each as favorable or unfavorable. (Indicate the effect of each variance by selecting for favorable, unfavorable, and no variance.)

	Actual Cost 0 0 Standard Cost 0 $0 0 $0 $0 $0

Answer 1

AQ 22220 Actual Cost X X 293304 АР 13.20 AQ 22220 X X 291082 Standard Cost SQL X 25760 X 337456 SP 13.10 13.10 2222 46374 Direct Material Price Varaince Direct Material Quantity Varaince Total Direct Material Varaince 3220*8 2222 46374 44152 Unfavorable Favorable Favorable 25760 Which Direct Material Varaince Will Hart Investigate Direct Material Price Varaince