Accounting Multiple Choice Question – 9 November 2023

The standard material cost of producing 1,500 units of a product A are shown below

• material X – 9,000kg at £4 per kg = £36,000
• material Y – 18,000 kg at £3 per kg = £54,000

The actual material cost to produce 1,500 units of product A was as follows.

• material X – 8,500kg used which cost £34,425
• material Y – 18,200kg used which cost £53,690

What is the total material usage variance?

Select ONE answer:

1. £1,400 favourable
2. £1,435 favourable
3. £2,600 favourable
4. £2,615 favourable

Show your workings to arrive at your answer, and explain and justify your reasons:

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

This multiple-choice question is suitable for Accounting KS5 classes.

The answer is 1

1. Correct – Standard price * (standard quantity – actual quantity) == > £4 * 500 FAV + £3 * 200 ADV = £1,400 FAV
2. Not correct
3. Not correct
4. Not correct

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