The Standards for Product K17 Call for 5

question 146

Essay

The standards for product K17 call for 5.0 meters of a raw material that costs $19.10 per meter. Last month, 2,700 meters of the raw material were purchased for $51,435. The actual output of the month was 460 units of product K17. A total of 2,500 meters of the raw material were used to produce this output.
The direct materials purchases variance is computed when the materials are purchased.
Required:
a. What is the materials price variance for the month?
b. What is the materials quantity variance for the month?

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Definitions:

Critical Value

A threshold value that delineates the boundary of the rejection region in statistical hypothesis testing.

Degrees Of Freedom

The number of independent values or quantities that can be assigned to a statistical distribution, impacting the calculation of a test statistic.

Expected Frequency

The theoretical frequency of an event or outcome calculated under a specific hypothesis for comparison with observed frequencies.

Groups

In the context of data analysis and statistics, groups refer to categories or sets into which data points are classified based on specific characteristics.