Suver Corporation has a standard costing system. The following data are available for June: ...

Question:

Suver Corporation has a standard costing system. The following data are available for June:

Actual quantity of direct materials purchased 24,000 pounds
Standard price of direct materials $6.00 per pound
Material price variance $6,000 Unfavorable
Material quantity variance $2,400 Favorable

The actual price per pound of direct materials purchased in June was:

A) $6.10 per pound

B) $5.90 per pound

C) $6.25 per pound

D) $6.30 per pound

Answer and Explanation:

Material Price variance = Actual quantity * (Actual price - Standard price)

6,000 = 24,000 * (Actual price - 6)

Actual price - 6 = 6,000/ 24,000

Actual price - 6 = 1/ 4

Actual price = 0.25 + 6

Actual price = 6.25


Learn more about this topic:

Standard Cost vs. Job Order Cost Overhead & Volume Variance

from Accounting 301: Applied Managerial Accounting

Chapter 13 / Lesson 7
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