Information on GB Co.'s direct material costs for May follows: Actual quantity of direct materials purchased and used Actual cost of direct materials. Unfavorable direct materials quantity variance, Standard quantity of direct materials allowed for May production, 30,000 pounds P84,000 P3,000 29,000 pounds P6,000 favorable P6,000 unfavorable P2,800 unfavorable P2,800 favorable
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.
For the month of May, what was GB's direct materials price variance?Required to answer.
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