Accorind go the production standard, each sweater is exptected to consume 2 pounds of cashmere. Standard price of cashmere is $4 per pound. Last week 2550 pounds of cashmere were purchased at a total of $12750, and 3075 pounds were used to make 1250 sweater. what is the direct material purchase price variance? a. 2550 F b. 450 F c. 450 U d.2550 U
Variance Analysis
In layman's terms, variance analysis is an analysis of a difference between planned and actual behavior. Variance analysis is mainly used by the companies to maintain a control over a business. After analyzing differences, companies find the reasons for the variance so that the necessary steps should be taken to correct that variance.
Standard Costing
The standard cost system is the expected cost per unit product manufactured and it helps in estimating the deviations and controlling them as well as fixing the selling price of the product. For example, it helps to plan the cost for the coming year on the various expenses.
Accorind go the production standard, each sweater is exptected to consume 2 pounds of cashmere. Standard price of cashmere is $4 per pound. Last week 2550 pounds of cashmere were purchased at a total of $12750, and 3075 pounds were used to make 1250 sweater. what is the direct material purchase price variance?
a. 2550 F
b. 450 F
c. 450 U
d.2550 U
Trending now
This is a popular solution!
Step by step
Solved in 2 steps
