Reference no: EM132620940

Problem - A company uses the following standard costs to produce a single unit of output.

Direct materials 6 pounds at $1.10 per pound = $6.60

Direct labor 0.5 hour at $8.00 per hour = $4.00

Manufacturing overhead 0.5 hour at $3.80 per hour = $1.90

During the latest month, the company purchased and used 58,000 pounds of direct materials at a price of $1.40 per pound to produce 10,000 units of output. Direct labor costs for the month totaled $37,012 based on 4,870 direct labor hours worked. Variable manufacturing overhead costs incurred totaled $16,000 and fixed manufacturing overhead incurred was $16,000. Based on this information, find the total direct materials cost variance for the month?