Reference: 11-07 The Following Materials Standards Have Been Established for a Particular

question 3

Multiple Choice

Reference: 11-07
The following materials standards have been established for a particular product:
Standard quantity per unit of output: 4.4 grams
Standard price: $13.20 per gram
The following data pertain to operations concerning the product for the last month: Actual materials purchased: 4,800 grams
Actual cost of materials purchased: $62,880
Actual materials used in production: 4,300 grams
Actual output: 700 units
-What is the materials price variance for the month?

• A)$480 F.
• B)$430 F.
• C)$480 U.
• D)$430 U.

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Definitions:

CPI

The Consumer Price Index (CPI) calculates the average price of a specific set of consumer items and services, including food, transportation, and medical care, which is used to gauge inflation by examining their weighted average cost.

Government Agency

An organization operated by the government to execute specific functions or provide services to the public.

CPI

The Consumer Price Index, a measure that examines the weighted average of prices of a basket of consumer goods and services, used as an indicator of inflation.

Price Level

An index that measures the average prices of goods and services in an economy over a period of time.