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Misha Larkins [42]
2 years ago
13

Edgar, Inc. has a materials price standard of $2.00 per pound. 6000 pounds of materials were purchased at $2.20 a pound. The act

ual quantity of materials used was 6000 pounds, although the standard quantity allowed for the output was 5400 pounds. Edgar, Inc.'s materials price variance is $120 U. $1200 U. $1080 U. $1200 F.
Business
1 answer:
Lemur [1.5K]2 years ago
8 0

Answer:

$1,200U

Explanation:

Edgar's inc material price variance would be computed as;

= [(AQ × AP) - (AQ × SP)]

Where;

AQ = Actual quantity = 6,000 pounds

AP = Actual price = $2.20

SP = Standard price = $2

Therefore, Edgar's inc Material price variance ;

= [(6,000 × $2.20) - (6,000 × $2)]

= [($13,200) - ($12,000)]

= $1,200U

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