Roberts Company Uses a Standard Costing System Roberts Company Reports Its Material Price Variances at the Time

question 64

Short Answer

Roberts Company uses a standard costing system.The following information pertains to direct materials for the month of July: $\begin{array}{lr}\text { Standard price per kg } & \$ 18.00 \\\text { Actual purchase price per kg } & \$ 16.50 \\\text { Quantity purchased } & 3,100 \mathrm{~kg} \\\text { Quantity used } & 2,950 \mathrm{~kg} \\\text { Standard quantity allowed for actual output } & 3,000 \mathrm{~kg} \\\text { Actual output } & 1,000 \text { units }\end{array}$
Roberts Company reports its material price variances at the time of purchase.
What is the journal entry to record material purchases?
a.
$\begin{array}{lr}\text { Materials } & 55,800 \\\quad \text { Accounts Payable } &&55,800 \\\end{array}$
b.
$\begin{array}{lr}\text { Accounts Payable } & 55,800 \\\quad \text { Materials } &&55,800 \\\end{array}$
c.
$\begin{array}{lr}\text { Materials } & 55,800 \\\quad \text { Materials Price Variance } &&4,650 \\\quad \text { Accounts Payable } &&51,150 \\\end{array}$
d.
$\begin{array}{lr}\text { Materials } & 51,150 \\\text { Materials Price Variance } & &4,650\\\quad \text { Accounts Payable }&&55,800\end{array}$

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