Question: Kellogg's Raisin Bran is famous for its advertising slogan of "Two scoops of raisins in every box." The current box design for Raisin Bran shows two scoops of raisins on the front of the box.
A few months ago, a post went viral on Reddit that showed a picture of the raisins actually found in the post writer's box of Raisin Bran. The pile of raisins appeared to be quite small. Next, two writers from Tech Insider measured the raisins versus flakes in two boxes of Kellogg's Raisin Bran. They found that, in this admittedly small sample size of two boxes, two scoops averaged out to be 1.25 cups of raisins, or about 13.9% of the total cereal (see http://www.techinsider.io/raisins-in-raisin-bran-two-scoops-quantity-2016-4.) During this same time, social media lit up with other Kellogg's Raisin Bran customers questioning the quantity of raisins in their boxes.
Back to the Reddit post. The photo posted showed the raisin quantity in the post writer's box to be much less than 1.25 scoops. If Kellogg's production of Raisin Bran used this quantity of raisins (the amount shown in the Reddit post) in all of the boxes it produced during that production run, then the materials quantity variance for raisins would have been favorable and significant.
By the way, the words "Raisin Bran" cannot be trademarked; those words were deemed to be too common to be allowed to trademark them. As a result, several companies produce and market their own "Raisin Bran."
Required: In a response of 350-400 words, answer two of the following questions and post your response:
1) Based on the information given, what would the standard quantity of raisins per box be?
2) Is a favorable raisin quantity variance good for Kellogg's Raisin Bran? Explain.
3) What could cause an unfavorable raisin quantity variance for Kellogg's Raisin Bran? Would the unfavorable quantity variance be good for Kellogg's Raisin Bran? Why or why not?
4) Would the direct materials price variance for raisins likely be related to the direct materials quantity variance? Explain.