The standard materials cost to produce 1 unit of product r is 6 pounds of material at a standard price of $50 per pound. in manufacturing 8,000 units, 47,000 pounds of material were used at a cost of $51 per pound. what is the total direct materials cost variance?

Question

Mathematics

Addyson Buck

15 April, 07:48

The standard materials cost to produce 1 unit of product r is 6 pounds of material at a standard price of $50 per pound. in manufacturing 8,000 units, 47,000 pounds of material were used at a cost of $51 per pound. what is the total direct materials cost variance?

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Gustavo Clay · Answer 1

If they used the material at a standard price:

48.000 * 50 = 2.400.000 $

If they used 47.000 pounds of material at 51$/pound

47000*51 + 1000*50=2.397.000 + 50.000=2.447.000

The cost variance is 2447.000 - 2.400.000 = 47.000