Asked by Urbano Contreras on Mar 10, 2024

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The raw materials price variance for the month is closest to:

A) $51,600 U
B) $48,568 F
C) $51,600 F
D) $48,568 U

Raw Materials Price Variance

The difference between the actual cost and the standard cost of raw materials used in production.

  • Understand how to calculate materials price variance.
  • Explicate the defining details of a favorable (F) in comparison to an unfavorable (U) variance.
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Verified Answer

RH
Raneen Hindi

Mar 10, 2024

Final Answer :
A
Explanation :
Materials price variance = (AQ × AP)− (AQ × SP)
= $548,250 − (64,500 grams × $7.70 per gram)
= $548,250 − $496,650
= $51,600 U