Drake Company purchased materials on account.The entry to record the purchase of materials having a standard cost of $1.50 per gram from a supplier at $1.60 per gram would include a:

Question

Quizplus · Accepted Answer

Since the materials were purchased at a higher price than the standard cost, there is an unfavorable materials price variance. Therefore, the entry should include a debit to materials price variance account.

Drake Company Purchased Materials on Account