# The lucy corporation purchased and used 129,000 board feet of lumber in production, at a total cost of \$1,548,000. original production

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The lucy corporation purchased and used 129,000 board feet of lumber in production, at a total cost of \$1,548,000. original production had been budgeted for 22,000 units with a standard material quantity of 5.7 board feet per unit and a standard price of \$12 per board foot. actual production was 23,500 units. compute the material price variance. a. 0 b. 59,400u c. 6,000u d. 59,400f

The correct answer is 0. There were no price variance. Explanation: Giving the following information: The Lucy Corporation purchased and used 129,000 board feet of lumber in production, at a total cost of \$1,548,000. Original production had been budgeted for 22,000 units with a standard material quantity of 5.7 board feet per unit and a standard price of \$12 per board foot. The actual production was 23,500 units. Direct material price variance= (standard price – actual price)*actual quantity Direct material price variance= (12 – 1,548,000/129,000)*129,000= 0

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Direct material quantity variance = (Standard quantity – Actual quantity) x standard price = (5.7 x 23500 – 129,000) x \$12 = \$59,400(F) The correct answer is B Explanation: Direct material quantity variance is the difference between standard quantity and actual quantity used multiplied by standard price. Standard quantity is obtained by the product of standard quantity per unit and actual production.

The direct materials quantity variance is  59,400 favourable. b. \$59,400 unfavourable Explanation: Material Quantity variance= standard price( Actual Quantity used – standard quantity) The standard quantity is standard price( Actual Quantity used – standard quantity) Therefore, Lucy corporation’s material quantity variance after using actual quantity of 129,000 at a standard price of 12 and the standard quantity of 133,950 is 59,400 favorable.

# The lucy corporation purchased and used 129,000 board feet of lumber in production, at a total cost of \$1,548,000. original production

## Introduction

As a business owner, you know that it’s important to keep your costs down while still delivering the necessary quality customer service. In this article, we’ll take a look at one way that you can do just that by purchasing lumber in bulk.

## Lucy Corporation Purchased and Used 129,000 Board Feet of Lumber in Production

The Lucy Corporation purchased and used 129,000 board feet of lumber in production. This purchase represented a total cost of \$,,. original production.

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## The Costs Associated with Purchasing and Using 129,000 Board Feet of Lumber

The lucy corporation purchased and used 129,000 board feet of lumber in production. The original production cost was \$,,.

The benefits of purchasing and using this amount of lumber include:

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-Faster Production: By using 129,000 board feet of lumber, the lucy corporation was able to increase its production rate by 25%.

-Lower Costs: By purchasing and using this amount of lumber, the lucy corporation was able to reduce its costs by \$,,.

## The Benefits of Purchasing and Using 129,000 Board Feet of Lumber

The lucy corporation purchased and used 129,000 board feet of lumber in production. The total cost of this lumber was \$,,. The benefits of purchasing and using this lumber include:

1. Increased Production
The use of 129,000 board feet of lumber increased the production of the lucy corporation by \$,,. This increase in production resulted in an increase in profits for the lucy corporation.

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2. Reduced Costs
The use of 129,000 board feet of lumber saved the lucy corporation \$,, in costs related to purchases of other materials and products.

3. Improved Quality
The use of 129,000 board feet of lumber resulted in improved quality products that met or exceeded customer expectations.

4. Increased Efficiency
The use of 129,000 board feet of lumber decreased the amount of time needed to produce a particular product by almost half. This efficiency increase allowed the lucy corporation to dedicate more resources to other areas of its business.

5. Reduced Waste
The use of 129,000 board feet of lumber eliminated the need to produce waste products that would have otherwise been created during production. This reduction in waste helped to improve the environmental sustainability of the l