Last month,75,000 kilograms of direct materials were purchased,and 71,000 kilograms were used.If the actual purchase price per kilogram was $0.50 more than the standard purchase price per kilogram,what was the materials price variance?

Question

Quizplus · Accepted Answer

Materials price variance = (actual price - standard price) x actual quantity purchased
Actual quantity purchased = 75,000 kg
Actual cost of actual quantity purchased = 75,000 x (standard price + $0.50)
Actual cost of actual quantity used = 71,000 x standard price
Materials price variance = (75,000 x ($0.50)) - (71,000 x ($0))
Materials price variance = $37,500 unfavourable

Last Month,75,000 Kilograms of Direct Materials Were Purchased,and 71,000 Kilograms