Problem
Bandar Industries manufactures sporting equipment. One of the company's products is a football helmet that requires special plastic. During the quarter ending June 30, the company manufactured 3,400 helmets, using 2,278 kilograms of plastic. The plastic cost the company $15,035.
According to the standard cost card, each helmet should require 0.60 kilograms of plastic, at a cost of $7.00 per kilogram.
Task
1) What is the standard quantity of kilograms of plastic (SQ) that is allowed to make 3,400 helmets?
2) What is the standard materials cost allowed (SQ × SP) to make 3,400 helmets?
3) What is the materials spending variance?
4) What is the materials price variance and the materials quantity variance?