EXERCISE 10-15 (CONTINUED) ALTERNATIVE SOLUTION

510, - SOLUTIONS TO QUESTION MANAGERIAL ACCOUNTING CH10 STANDARD COST AND THE BALANCE SCORECARD 510, - SOLUTIONS TO QUESTION MANAGERIAL ACCOUNTING CH10 STANDARD COST AND THE BALANCE SCORECARD
SOLUTIONS TO QUESTION MANAGERIAL ACCOUNTING CH10 STANDARD COST AND THE BALANCE SCORECARD
510,000 feet ($3.20 per foot – $3.00 per foot) = $102,000 U Materials quantity variance = SP (AQ – SQ) $3 per foot (510,000 feet – 540,000 feet) = $90,000 F Yes, the decrease in waste is apparent because of the $90,000 favorable quantity variance. If the company wants to continue to compute the material price vari-ance, then the standard price per foot should be changed to reflect cur-rent JIT purchase costs. The old standard price of $3.00 per foot is no longer relevant. Problem 10-27 (continued)