Inezza Industries purchased and consumed 72,000 gallons of direct material that was used in the production of 15,000 finished units of product. According to engineering specifications, each finished unit had a manufacturing standard of five gallons. If the material price variance is $7,200U and the material quantity variance is $2,400F, what is the actual price paid for a gallon of direct material?
Inezza Industries purchased and consumed 72,000 gallons of direct material that was used in the production of 15,000 finished units of product. According to engineering specifications, each finished unit had a manufacturing standard of five gallons. If the material price variance is $7,200U and the material quantity variance is $2,400F, what is the actual price paid for a gallon of direct material?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Inezza Industries purchased and consumed 72,000 gallons of direct material that was used in the production of 15,000 finished units of product. According to engineering specifications, each finished unit had a manufacturing standard of five gallons. If the material price variance is $7,200U and the material quantity variance is $2,400F, what is the actual price paid for a gallon of direct material?
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