Seraphine Corporation manufactures rhinestone-studded jewelry boxes.The following materials standards have been established for the rhinestones used to decorate the jewelry boxes. $\begin{array}{|l|r|}
\hline \text { Standard quantity per jewelry box (grams) } & 4.0 \
\hline \text { Standard price per gram of rhinestones } & \$ 2.50 \
\hline
\end{array}$
The following data relates to the production of the jewelry boxes during June:
$\begin{array} { | l | r | }
\hline \text { Actual rhinestones purchased and used (grams) } & 1,200 \
\hline \text { Actual cost of rhinestones purchased } & \$ 2,350 \
\hline \text { Actual number of jewelry boxes produced } & 450 \
\hline
\end{array}$
What is the materials price variance for rhinestones in June?

Question

Seraphine Corporation manufactures rhinestone-studded jewelry boxes.The following materials standards have been established for the rhinestones used to decorate the jewelry boxes. $\begin{array}{|l|r|}
\hline \text { Standard quantity per jewelry box (grams) } & 4.0 \
\hline \text { Standard price per gram of rhinestones } & \$  2.50 \
\hline
\end{array}$
 The following data relates to the production of the jewelry boxes during June:
$\begin{array} { | l | r | } 
\hline \text { Actual rhinestones purchased and used (grams) } & 1,200 \
\hline \text { Actual cost of rhinestones purchased } & \$ 2,350 \
\hline \text { Actual number of jewelry boxes produced } & 450 \
\hline
\end{array}$
What is the materials price variance for rhinestones in June?

Quizplus · Accepted Answer

The materials price variance is calculated as follows:Materials price variance = (Actual quantity used * Standard price) - (Actual cost of rhinestones purchased)= (1,200 grams * $2.50) - $2,350= $3,000 - $2,350= $650 favorable

Seraphine Corporation Manufactures Rhinestone-Studded Jewelry Boxes The Following Data Relates to the Production of the Jewelry