Question - Stacy, Inc., produces a product using a process that allows for substitution between two materials, Alpha and Beta. The company has the following direct materials data for its product:
Standard costs for one unit of output -
Alpha - 54 units of input at $ 12
Beta - 108 units of input at $ 14.5
The company had the following results in June:
Units of output produced 2,700 units Materials purchased and used
Alpha - 153,800 units at $ 11.3
Beta - 283,600 units at $ 15.3
Required:
a. Compute materials price and efficiency variances.
b. Compute materials mix and yield variances.