newconnect.mheducation.com tiple Choice Quiz-10 questions-60 mi... Saved Help Sa

Question

newconnect.mheducation.com tiple Choice Quiz-10 questions-60 mi... Saved Help Save & Exit Gipple Corporation makes a product that uses a material with the quantity standard of 8.9 grams per unit of output and the price standard of $7.60 per gram. In January the company produced 5,000 units using 26,470 grams of the direct material. During the month the company purchased 29,000 grams of the direct material at $7.70 per gram. The direct materials purchases variance is computed when the materials are purchased The materials price variance for January is: Multiple Choice $4,450 U $2,900 U

Explanation / Answer

Material price variance = (Standard price-actual price)Actual quantity purchased

                                     = (7.60-7.70)*29000

Material price variance = 2900 U

so answer is b) 2900 U

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