In its first month of operations, Multiplex Corporation purchased 40,000 pounds of material for $3.40 per pound. The company used 38,000 pounds of the material to produce 18,000 units of its only product. Multiplex uses a standard cost system and its standard quantity and price per unit are 2 pounds at $3.50 per pound. What was the material efficiency variance for the month?

Multiple Choice

• $5,000 favorable

• $7,000 unfavorable

• None of these.

• $7,000 favorable

• $5,000 unfavorable