The materials price variance for June is:

A) $2,140 U
B) $2,140 F
C) $1,820 U
D) $1,820 F

Question

The materials price variance for June is: A)$2,140 U B)$2,140 F C)$1,820 U D)$1,820 F

Michael Osborne · Accepted Answer

Final Answer : B, Explanation :  The materials price variance is calculated as (actual price - standard price) x actual quantity. From the information given in the question, we have: actual price = $8.20, standard price = $7.00, actual quantity = 8,400 lbs.   Therefore, the materials price variance for June is ($8.20 - $7.00) x 8,400 = $2,140 F. AQ × AP = $40,660 Materials price variance = (AQ × AP)− (AQ × SP) = ($40,660)− (21,400 ounces × $2.00 per ounce) = $40,660 − $42,800 = $2,140 F

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