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Question - Balt Company maintains a standard cost system; as such, all inventories, including materials, are carried on the books at standard cost. Last period, Balt used 5500 pounds to produce 600 units of Product C8. The company has established a standard of 8 pounds of Material H per unit of C8, at a price of $6.00 per pound of material. During the period, Balt purchased 3200 pounds of Material H. The company spent $7 per pound during the period to purchase material H.
Required -
1. Calculate the direct materials purchase-price variance for the period, rounded to the nearest dollar.
2. Calculate the direct materials usage variance for the period, rounded to the nearest whole dollar.
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