Kartman Corporation Makes a Product with the Following Standard Costs

question 100

Multiple Choice

Kartman Corporation makes a product with the following standard costs:
In June the company's budgeted production was 3,400 units but the actual production was 3,500 units. The company used 22,150 pounds of the direct material and 2,290 direct labor-hours to produce this output. During the month, the company purchased 25,400 pounds of the direct material at a cost of $170,180. The actual direct labor cost was $57,021 and the actual variable overhead cost was $8,931.
The company applies variable overhead on the basis of direct labor-hours. The direct materials purchases variance is computed when the materials are purchased.
-The materials price variance for June is:

• A) $7,620 U
• B) $6,825 U
• C) $6,825 F
• D) $7,620 F

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Definitions:

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