Question 10 0.7 points Save Answer The standard cost of Product B includes 2 uni

Question

Question 10 0.7 points Save Answer The standard cost of Product B includes 2 units of direct materials at $5 per unit. During June, 17,050 units of direct material were purchased and used at a cost of $4.7 per unit to produce 9,200 units of Product B Compute the variance requested below and indicate whether the variance is favorable or unfavorable, by indicating U or F. Place the letter by the number, DO NOT add a space. Example, if the variance is 100 unfavorable, enter 10OU (DO NOT PUT 100 U) The Direct Materials spending variance is $

Explanation / Answer

The Direct Materials Spending Variance = (Actual Price - Standard Price ) * Actual Units

= ( $ 4.7 - $ 5) * 17,050Units

= $ 5,115 Favorable

Since the Actual Price is less than the Standard Price, the Variance is Favorable

Hence the correct answer is 5,115F

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