Question
Genent Industries, Inc. (GII), developed standard costs for direct material and direct labor. In 2017, GII estimated the following standard costs for one of their
Genent Industries, Inc. (GII), developed standard costs for direct material and direct labor. In 2017, GII estimated the following standard costs for one of their major products, the 30-gallon heavy-duty plastic container.
Budgeted quantity | Budgeted price |
Direct materials | 0.50 pounds | $50 per pound |
Direct labor | 0.60 hours | $13 per hour |
During July, GII produced and sold 4000 containers using 2250 pounds of direct materials at an average cost per pound of $47 and 2450 direct manufacturing labor hours at an average wage of $13.50 per hour. The direct material price variance during July is ________.
A | $6750 unfavorable | |
B | $6750 favorable | |
C | $12,500 unfavorable | |
D | $12,000 unfavorable |
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