Gala Enterprises Reports the Following Information Regarding the Production of One

Essay

Gala Enterprises reports the following information regarding the production of one of its products for the month. Compute the direct materials cost variance, the direct materials price variance, the direct materials quantity variance and identify each as either favorable or unfavorable.
$\begin{array} { l l } \text { Direct materials standard (6 lbs. @ \$3/lb.) } & \$ 18 \text { per finished unit } \\\text { Actual direct materials used } & 179,000 \mathrm { lbs } . \\\text { Actual finished units produced } & 30,000 \text { units } \\\text { Actual cost of direct materials used } & \$ 554,900\end{array}$