The Big Blackbird Company manufactures decorative scarecrows that have a standard cost of $3.50 per pound for direct materials used in the manufacturing process. During September, 30,000 pounds of materials were purchased for $4.00 per pound, and 24,000 pounds were actually used in making 5,000 scarecrows. There were no beginning inventories.
Required:
a. Determine the materials price variance assuming that materials costs are the responsibility of the materials purchasing manager.
b. Determine the materials price variance assuming that materials costs are the responsibility of the production manager.
c. Determine the material quantity variance if the standard materials for each scarecrow are 6 pounds.