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James Inc.'s flexible budget for June,based upon actual output,called for the use of 10,500 pounds of materials at a standard cost of $7.40 per pound.The Production Department actually used 10,700 pounds of materials costing $7.10 per pound during June.
-James's materials price variance for June is:
A)$3,150 unfavorable.
B)$3,150 favorable.
C)$3,210 unfavorable.
D)$3,210 favorable.

Question

Quizplus · Accepted Answer

Materials price variance = (Actual price - Standard price) x Actual quantity
= ($7.10 - $7.40) x 10,700
= $3,210 favorable.

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