Sanchez Company's output for the current period was assigned a $200,000 standard direct materials cost. The direct materials variances included a $5,000 favorable price variance and a $3,000 unfavorable quantity variance. What is the actual total direct materials cost for the current period?
A) $202,000.
B) $192,000.
C) $208,000.
D) $198,000.
E) $205,000.

Question

Quizplus · Accepted Answer

Actual Total Direct Materials Cost = Standard Direct Materials Cost + Direct Materials Price Variance + Direct Materials Quantity Variance

Actual Total Direct Materials Cost = $200,000 + $5,000 - $3,000 = $202,000 - $3,000 = $199,000

Therefore, the actual total direct materials cost for the current period is $198,000 (Option D).

Sanchez Company's Output for the Current Period Was Assigned a $200,000