Cryolite uses a standard costing system to gauge results for their single product. 70,000 kilograms of direct materials were purchased for $385,000. Two kilograms of direct materials are needed to produce one unit of product. In March, the company produced 12,000 units. The standard cost allowed for direct material was $120,000, and there was an unfavourable direct materials efficiency variance of $2,500.
The direct materials price variance for March is:
A) $25,000 favourable
B) $25,000 unfavourable
C) $35,000 favourable
D) $35,000 unfavourable

Question

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The Answer of Cryolite uses a standard costing system to gauge results for their single product. 70,000 kilograms of direct materials were purchased for $385,000. Two kilograms of direct materials are needed to produce one unit of product. In March, the company produced 12,000 units. The standard cost allowed for direct material was $120,000, and there was an unfavourable direct materials efficiency variance of $2,500.
The direct materials price variance for March is:
A) $25,000 favourable
B) $25,000 unfavourable
C) $35,000 favourable
D) $35,000 unfavourable

Cryolite Uses a Standard Costing System to Gauge Results for Their