Direct Materials Variances The following data relate to the direct materials cost for the production of 10,000 automobile tires: Actual: 145,000 lb. at $2.80 Standard: 150,000 lb. at $2.75 a....

Direct Materials Variances

The following data relate to the direct materials cost for the production of 10,000 automobile tires:

a.Determine the direct materials price variance, direct materials quantity variance, and total direct materials cost variance. Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number.

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  .