Select the correct statement from the following,assuming Carmichael Company had a favorable direct materials price variance of $3,000 and an unfavorable direct materials usage variance of $2,000.
A) The total direct materials variance is $1,000 unfavorable.
B) The total direct materials variance is $5,000 favorable.
C) The total direct materials variance is $5,000 unfavorable.
D) The total direct materials variance is $1,000 favorable.

Question

Quizplus · Accepted Answer

The total direct materials variance is the sum of the direct materials price variance and the direct materials usage variance.
Total direct materials variance = Favorable direct materials price variance - Unfavorable direct materials usage variance
= $3,000 - $2,000
= $1,000 (favorable)

Select the Correct Statement from the Following,assuming Carmichael Company Had