Problem:
Gumchara Corporation reported the following information with respect to the materials required to manufacture amalgam florostats during the current month:
| Standard price per gram of material |
$4 |
| Standard quantity of materials per amalgam florostat |
5 grams |
| Actual materials purchased and used in production |
6,000 grams |
| Actual amalgam florostats produced during the month |
1,000 units |
| Actual cost of materials purchased |
$18,000 |
| Normal monthly output |
900 units |
Required:
Question 1: Determine Gumchara's materials price variance
Question 2: Determine Gumchara's materials quantity variance
Question 3: Will Gumchara's overhead volume variance be favorable or unfavorable? Why?
Note: Please show the work not just the answer.