Tidd Corporation makes a product with the following standard costs:
| |
Standard Quantity or Hours |
Standard Price or Rate |
Standard Cost Per Unit |
| Direct materials |
4.7 grams |
$3.00 per gram |
$14.10 |
| Direct labor |
0.8 hours |
$16.00 per hour |
$12.80 |
| Variable overhead |
0.8 hours |
$4.00 per hour |
$3.20 |
The company reported the following results concerning this product in November.
| Originally budgeted output |
8,900 |
units |
| Actual output |
9,000 |
units |
| Raw materials used in production |
44,810 |
grams |
| Purchases of raw materials |
47,300 |
grams |
| Actual direct labor-hours |
7,870 |
hours |
| Actual cost of raw materials purchases |
$132,440 |
|
| Actual direct labor cost |
$125,133 |
|
| Actual variable overhead cost |
$29,906 |
|
The company applies variable overhead on the basis of direct labor-hours. The direct materials purchases variance is computed when the materials are purchased.
The materials quantity variance for November is: