Kermit Enterprises has collected the following data on one of its products:
| Direct materials standard (3 lbs.@ $1.00/b.) | $3per finished unit |
| Total direct materials cost variance— favorable | $9,900 |
| Actual direct materials used | 250,800 lbs |
| Actual finished units produced | 38,000 units |
| The direct materials quantity variance is: |
| $126,900 favorable. | |
| $136,800 unfavorable. | |
| $136,800 favorable. | |
| $47,900 unfavorable. | |
| $47,900 favorable. |
Best answer
Direct materials quantity variance = Actual finished units *3*$1
- Actual direct materials*$1= 38,000 * 3* $1 - $250,800 = -136,800 (Unfavorable)
