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P Company makes product ABC and shares the standard inputs that make up the product: 10.8 lbs- standard quantity per unit. $4 - standard price
P Company makes product ABC and shares the standard inputs that make up the product:
10.8 lbs- standard quantity per unit.
$4 - standard price per pound.
P company produced 50,000 units of ABC, which took 600,000 pounds of material costing $2,390,000.
Calculate:
Total materials variance. Favorable or unfavorable?
Materials price variance. Favorable or unfavorable?
Materials usage variance. Favorable or unfavorable?
Provide a brief explanation of the variances and include what they mean and the cause.
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