Question

he following materials standards have been established for a particular product: Standard quantity per unit of output 5.0 meters Standard price $18.90 per meter The following data pertain to operations concerning the product for the last month: Actual materials purchased 8,500 meters Actual cost of materials purchased $170,000 Actual materials used in production 8,000 meters Actual output 1,570 units What is the materials price variance for the month

Answer 1

Answer:

the material price variance is $9,350 unfavorable

Explanation:

The computation of the material price variance is shown below

Materials Price Variance

= (Standard price - Actual price) ×Actual quantity  

= ($18.90 - $170,000 ÷ 8,500) × 8,500

= ($18.90 - $20) × 8,500

= $9,350 Unfavorable

hence, the material price variance is $9,350 unfavorable