Question: Marrick firm create one product, for which it has established the following standards for materials:
Average quantity of material per unit of product: 4.5 pounds
Price per pound of materials, $8
During March, Marrick create 10,000 units of the product, using 50,000 pounds at a total price of $412,500.
Required:
[A] Calculate total flexible budget materials variance and indicate whether it is favorable or unfavorable.
[B] Determine materials price variance and indicate whether it is favorable or unfavorable.
[C] Calculate materials usage variance and indicate whether it is favorable or unfavorable.