Candy Stores Inc.gives you the following information: The standard material cost is $7 per pound for a 15 pound bag of chocolate.The following is the actual cost and usage data:
Using the above information provided for Candy Stores.
-Compute the direct materials price variance for Candy Stores.
A)$186,000 (
B)$186,000 (
C)$42,000 (
D)$42,000 (

Question

Candy Stores Inc.gives you the following information: The standard material cost is $7 per pound for a 15 pound bag of chocolate.The following is the actual cost and usage data:
 Using the above information provided for Candy Stores.
-Compute the direct materials price variance for Candy Stores.
A)$186,000 (
B)$186,000 (
C)$42,000 (
D)$42,000 (

Quizplus · Accepted Answer

The direct materials price variance is calculated as (Actual Price - Standard Price) x Actual Quantity. If the variance is favorable (F), it means the actual cost was less than the standard cost. Here, $186,000 (F) indicates a favorable variance.