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Metlock, Inc. has a materials price standard of $2.00 per pound. Six thousand pounds of materials were purchased at $2.20 a pound. The actual quantity of materials used was 5100 pounds, although the standard quantity allowed for the output was 4900 pounds. Metlock, Inc.'s materials price variance is:_______

a. $980 U.
b. $1020 F.
c. $40 U.
d. $1020 U.

Respuesta :

ayokenny2001

Answer:

d. $1,020 unfavorable

Explanation:

Given the above information, Metlock inc's material price variance is computed as;

Materials price variance = (Standard price - Actual price) × Actual quantity

Material price variance

Standard price = $2

Actual price = $2.2

Actual quantity = 5,100 pounds

Therefore,

Material price variance

= ($2 - $2.2) × 5,100

= -$0.2 × 5,100

= $1,020 unfavourable

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