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ExtremeBDS [4]
3 years ago
8

Crane WaterWorks manufactures snorkel gear. During the past month, Washington purchased 4,130 pounds of plastic to use in its di

ve masks, at a cost of $5,972. The standard price for the plastic is $1.433 per pound. The company actually used 4,060 pounds of the plastic to produce 18,500 dive masks.
a.Calculate crane waterworks direct materials price variance for the month.
Business
1 answer:
goldfiish [28.3K]3 years ago
5 0

Answer:

Direct material price variance= $53.69 unfavorable

Explanation:

Giving the following information:

Actual purchase= 4,130 pounds of plastic

Actual cost= $5,972 (total)

The standard price for the plastic is $1.433 per pound.

The company used 4,060 pounds of the plastic to produce 18,500 dive masks.

To calculate the direct material price variance, we need to use the following formula:

Direct material price variance= (standard price - actual price)*actual quantity

Actual price= 5,972/4,130= $1.446

Direct material price variance= (1.433 - 1.446)*4,130= $53.69 unfavorable

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