8

Gipple Corporation makes a product that uses a material with the quantity standard of 9.0 grams per unit of output and the price standard of $7.70 per gram. In January the company produced 5,100 units using 26,570 grams of the direct material. During the month the company purchased 29,100 grams of the direct material at $7.80 per gram. The direct materials purchases variance is computed when the materials are purchased.

The materials price variance for January is:

Multiple Choice

• $4,590 F

• $2,910 U

• $4,590 U

• $2,910 F