We appreciate your visit to Goodard Inc planned to use 156 of material per unit but actually used 141 of material per unit They planned to make 1 150 units. This page offers clear insights and highlights the essential aspects of the topic. Our goal is to provide a helpful and engaging learning experience. Explore the content and find the answers you need!
Answer :
Final answer:
The material cost variance is equal to $18,240 unfavorable.
Explanation:
The material cost variance is calculated by subtracting the actual material cost per unit from the planned material cost per unit and multiplying it by the difference in the planned and actual number of units produced.
In this case, the planned material cost per unit is $156 and the actual material cost per unit is $141, resulting in a difference of $15 per unit.
The planned number of units is 1,150 and the actual number of units is 920, resulting in a difference of 230 units.
The material cost variance is therefore equal to $15 per unit multiplied by 230 units, which equals $3,450.
Since the actual material cost per unit is less than the planned material cost per unit, the material cost variance is unfavorable (U).
Hence, the correct answer is b. $18,240 U.
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