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Problem - Direct materials variances - The May Company manufactures plastic toy cars. Each toy car requires 16 standard pounds of resin (plastic). Each pound of resin has a standard cost of $3.25 per pound. Actual production information is as follows:
Volume: 800 toy cars
Actual material price per pound: $3.15
Actual pounds of resin used to produce each car: 16.2
Actual total pounds of used: 12,960 (800 cars x 16.2 pounds)
Required - Determine the direct materials price variance, direct materials quantity variance, and the direct materials cost variance.
Last year, the company incurred $200,000 in overhead costs. How much overhead should be applied to the above customer order
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Distinguish between gross profit as a percentage of cost and gross profit as a percentage of sales prices.
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