A total of 6,850 kilograms of a raw material was purchased at a total cost of $21,920. The materials price variance was $1,370 favorable. The standard price per kilogram for the raw material must be:
A) $0.20
B) $3.00
C) $3.20
D) $3.40

Question

Quizplus · Accepted Answer

The actual price per kilogram is $21,920 / 6,850 = $3.20. Since the variance is favorable, the standard price must be higher than the actual price. Therefore, the standard price is $3.40.

A Total of 6,850 Kilograms of a Raw Material Was