Summit Manufacturing purchased 75,000 pounds of material for $412,500. The standard cost is $6.00 per pound. During the period, Summit produced 24,800 units, with each unit requiring a standard of 3 pounds of material. Actual usage was 70,500 pounds. What is the materials purchase price variance?

Summit Manufacturing purchased 75,000 pounds of material for $412,500. The standard cost is $6.00 per pound. During the period, Summit produced 24,800 units, with each unit requiring a standard of 3 pounds of material. Actual usage was 70,500 pounds. What is the materials purchase price variance?

Managerial Accounting: The Cornerstone of Business Decision-Making

7th Edition

ISBN:9781337115773

Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Publisher:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Chapter10: Standard Costing And Variance Analysis

Section: Chapter Questions

Problem 58E: At the beginning of the year, Lopez Company had the following standard cost sheet for one of its...

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Summit Manufacturing purchased 75,000 pounds of material for
$412,500. The standard cost is $6.00 per pound. During the period,
Summit produced 24,800 units, with each unit requiring a standard
of 3 pounds of material. Actual usage was 70,500 pounds. What is
the materials purchase price variance?

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