Cabot Company collected the following data regarding production of one of its products.Compute the direct materials cost variance. $$\begin{array} { l l }
\text { Direct materials stardard (6lbs. @ } \$ 2 / lb ) & \$ 12 \mathrm { per } \text { firished urit } \
\text { Actual direct materials used } & 243,000 \mathrm { lbs } \
\text { Actual firished urits produced } & 40,000 \mathrm { units } \
\text { Actual cost of direct materials used } & \$ 483,570
\end{array}$$
A)$6,000 favorable.
B)$3,570 unfavorable.
C)$2,430 favorable.
D)$6,000 unfavorable.
E)$3,570 favorable.

Question

Cabot Company collected the following data regarding production of one of its products.Compute the direct materials cost variance. $$\begin{array} { l l } 
\text { Direct materials stardard (6lbs. @ } \$ 2 / lb ) & \$ 12 \mathrm { per } \text { firished urit } \
\text { Actual direct materials used } & 243,000 \mathrm { lbs } \
\text { Actual firished urits produced } & 40,000 \mathrm { units } \
\text { Actual cost of direct materials used } & \$ 483,570
\end{array}$$
A)$6,000 favorable.
B)$3,570 unfavorable.
C)$2,430 favorable.
D)$6,000 unfavorable.
E)$3,570 favorable.

Quizplus · Accepted Answer

The Answer of Cabot Company collected the following data regarding production of one of its products.Compute the direct materials cost variance. $$\begin{array} { l l } 
\text { Direct materials stardard (6lbs. @ } \$ 2 / lb ) & \$ 12 \mathrm { per } \text { firished urit } \
\text { Actual direct materials used } & 243,000 \mathrm { lbs } \
\text { Actual firished urits produced } & 40,000 \mathrm { units } \
\text { Actual cost of direct materials used } & \$ 483,570
\end{array}$$
A)$6,000 favorable.
B)$3,570 unfavorable.
C)$2,430 favorable.
D)$6,000 unfavorable.
E)$3,570 favorable.

Cabot Company Collected the Following Data Regarding Production of One