Canevari Corporation makes a product that uses a material with the following standards: The company budgeted for production of 1, 300 units in April, but actual production was 1, 200 units.The company used 3, 750 kilos of direct material to produce this output.The company purchased 4, 100 kilos of the direct material at a total cost of $8, 610.The direct materials purchases variance is computed when the materials are purchased. The materials price variance for April is:

Question

Canevari Corporation makes a product that uses a material with the following standards:  The company budgeted for production of 1, 300 units in April, but actual production was 1, 200 units.The company used 3, 750 kilos of direct material to produce this output.The company purchased 4, 100 kilos of the direct material at a total cost of $8, 610.The direct materials purchases variance is computed when the materials are purchased. The materials price variance for April is:

Quizplus · Accepted Answer

AQ × AP = $8, 610
Materials price variance = (AQ × AP)- (AQ × SP)
= ($8, 610)- (4, 100 kilos × $2.00 per kilo)
= $8, 610 - $8, 200
= $410 U

Canevari Corporation Makes a Product That Uses a Material with the Following