Question

The standard materials cost to produce one unit of product m is 6 pounds of material at a standard price of $50 per pound. in manufacturing 8,000 units, 47,000 pounds of material were used at a cost of $51 per pound. what is the total direct material cost variance?

Answer 1

Direct material cost variance = (Standard price - Actual Price) * Actual Quantity
= ($50 - $51) * 47,000
= $47,000 adverse