Hurst Company's standard variable materials cost per unit was $8.The actual materials cost per unit on production of 10,000 units was $8.22.Based on this information,Hurst Company incurred an unfavorable variable materials price variance of $2,200.

Question

Quizplus · Accepted Answer

The unfavorable variance is calculated as follows:

Variable materials price variance = (Actual price - Standard price) x Actual quantity
Variable materials price variance = ($8.22 - $8) x 10,000
Variable materials price variance = $0.22 x 10,000
Variable materials price variance = $2,200

Therefore, the statement is true.

Hurst Company's Standard Variable Materials Cost Per Unit Was $8