Company S purchased 1,000 units raw materials amounting to $5,000 and used
$4,500 worth for the production during the current month. The standard price for
these raw materials is $5.2 per unit. How much is the materials price variance for the
current month if Company S analyzes the variance at the point of purchase?

1. $200 favorable
2. $200 unfavorable
3. $700 favorable
4. $700 unfavorable