Shoemaker Perkins Company Uses a Standard Cost System and Had

question 155

Multiple Choice

Shoemaker Perkins Company uses a standard cost system and had 400 pounds of raw material X15 on hand on September 1. The standard cost of X15 is $10.00 per pound. The production standard calls for 2 pounds of material X15 for each unit of product manufactured. The company manufactured 600 units of the product in September, and had 500 pounds of material X-15 in stock on September 30. The actual price for material X-15 purchased during the month was $1 per pound below the standard cost. The material usage variance in September was $3,000 unfavorable. What is the purchase-price variance for material X in September, rounded to the nearest dollar?

• A) $1,100 favorable.
• B) $1,200 favorable.
• C) $1,300 favorable.
• D) $1,500 favorable.
• E) $1,600 favorable.

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