Problem based on materials price variance


The Porter Company has a standard cost system. In July the company purchased and used 22,500 pounds of direct material at an actual cost of $53,000; the materials quantity variance was $1,875 Unfavorable; and the standard quantity of materials allowed for July production was 21,750 pounds. The materials price variance for July was:

a. $2,725 F.

b. $2,725 U.

c. $3,250 F.

d. $3,250 U.

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Accounting Basics: Problem based on materials price variance
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