Calculate the Material Usage Variance

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Reference no: EM132952050

Question - For making 10 kg. of yarn, the standard material requirement rates are:

Material Quantity = 4 kg   Rate per kg. = Rs. 3.00.

In a month, 2,000 kg. of yarn was produced. The actual consumption of materials is as under: Material Quantity = 700 kg Rate per kg. = Rs. 4.00

(a) Calculate the Material Usage Variance?

(b) Calculate the Material Price Variance?

(c) Calculate the Material Cost Variance?

Give reasons for your answer. Discuss how the management can remedy the unfavorable variances.

Reference no: EM132952050

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