Joined: 23 Oct 2009
Online Status: Offline Posts: 61
Posted: 15 Nov 2009 at 22:37 | IP Logged
acc to my calculations answer should be A but answer is D.Plz solve..
t takes 10 pounds of plastic to make a widget under normal
conditions and plastic normally costs $2 per pound. This year, a
company buys 100,000 pounds of plastic at $2.20 per pound and uses
73,000 pounds to make 7,000 widgets. In a standard cost accounting
system, what is the material price variance?
Joined: 11 Oct 2009
Online Status: Offline Posts: 396
Posted: 15 Nov 2009 at 22:50 | IP Logged
The question is asking the PRICE variance, Price variance needs to times the actual amount purchased. Usuage variance needs to time the actual amount used in production.
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Topic: variance problem
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