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Question - Direct Materials Variances - The following data relate to the direct materials cost for the production of 2,400 automobile tires:
Actual: 60,100 lb. at $1.95
Standard: 61,900 lb. at $2.00
Required -
a. Determine the direct materials price variance, direct materials quantity variance, and total direct materials cost variance.
b. The direct materials price variance should normally be reported to the _____________. If lower amounts of direct materials had been used because of production efficiencies, the variance would be reported to the _____________. If the favorable use of raw materials had been caused by the purchase of higher-quality raw materials, the variance should be reported to the _____________.
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