Register now or log in to join your professional community.
Varianve will be A-500000 favorable B-500000 UNfavorable C-1000000 favorable D-1000000 unfavorable
Variance will be option >>>>>>>>>>>>> A-500000 favorable
(Even though the figure seems to be exaggeration)
Material Price Variance = (Standard Price - Actual Price) * Actual Production
= (15 -5 ) *50,000 Units
= 10 *50,000
= 500,000 Favorable
Favorable because we pay for material actually less than the standard. Therefore, this is favorable.
So, the option (A) is the Correct Ans.
A-.........>>>>>>>>>>>>>>>500000 favorable
