# Calculate the following variances for September 1. Materials quantity variance.

P8-3 Accelerator, Inc.
manufactures a fuel additive, Stomp, that has a stable selling price of \$44 per
drum. The company has been producing and selling 80,000 drums per month.
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In connection with your
examination of Accelerator’s financial statements for the year ended September
the company’s operations:

Standard costs per drum of product manufactured:
Materials:
8 gallons of chemicals@\$2 . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . \$16
1 empty drum @ \$1/drum . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . 1 \$17
Direct labor: 1 hour @ \$8/hour . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . \$ 8
Factory Overhead . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . \$ 6
Costs and expenses during September:
Stomp: 600,000 gallons purchased at a cost of \$1,140,000; 645,000 gallons used.
Empty drums: 94,000 purchased at a cost of \$94,000; 80,000 drums used.
Direct labor: 81,000 hours worked at a cost of \$654,480.