Asked by Brian Anderson on Mar 10, 2024

Verified

The materials price variance for June is:

A) $2,140 U

B) $2,140 F

C) $1,820 U

D) $1,820 F

A) $2,140 U

B) $2,140 F

C) $1,820 U

D) $1,820 F

Materials Price Variance

The difference between the actual cost of materials purchased and the expected cost, based on standard prices.

- Become adept at analyzing and determining the differences in material cost variances.

Verified Answer

MO

Michael Osborne

Mar 10, 2024

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.

Therefore, the materials price variance for June is ($8.20 - $7.00) x 8,400 = $2,140 F.

Explanation :

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

Materials price variance = (AQ × AP)− (AQ × SP)

= ($40,660)− (21,400 ounces × $2.00 per ounce)

= $40,660 − $42,800

= $2,140 F

## Learning Objectives

- Become adept at analyzing and determining the differences in material cost variances.

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