Assume the following information appears in the standard cost card for a company that makes only one product: Standard Quantity or HoursStandard Price or RateStandard CostDirect materials5pounds$ 11.00per pound$ 55.00Direct labor2hours$ 17.00per hour$ 34.00Variable manufacturing overhead2hours$ 3.00per hour$ 6.00During the most recent period, the following additional information was available:20,000 pounds of material was purchased.The materials price variance was $10,000 F.All of the material that was purchased was used to produce 3,900 units.8,000 direct labor-hours were recorded at a total cost of $132,000.What is the actual price per pound of materials?

Material Price Variance :— It is the difference between actual quantity of material at standard…

Answered: Assume the following information…

Principles of Cost Accounting

17th Edition

ISBN:9781305087408

Author:Edward J. Vanderbeck, Maria R. Mitchell

Publisher:Edward J. Vanderbeck, Maria R. Mitchell

Chapter7: The Master Budget And Flexible Budgeting

Section: Chapter Questions

Problem 11P: Overhead application rate Creole Manufacturing Inc. uses a job order cost system and standard costs....

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Assume the following information appears in the standard cost card for a company that makes only one product:

	Standard Quantity or Hours	Standard Price or Rate	Standard Cost
Direct materials	5	pounds	$ 11.00	per pound	$ 55.00
Direct labor	2	hours	$ 17.00	per hour	$ 34.00
Variable manufacturing overhead	2	hours	$ 3.00	per hour	$ 6.00

During the most recent period, the following additional information was available:

20,000 pounds of material was purchased.
The materials price variance was $10,000 F.
All of the material that was purchased was used to produce 3,900 units.
8,000 direct labor-hours were recorded at a total cost of $132,000.

What is the actual price per pound of materials?

Definition Definition System of assigning an estimated cost to the product (instead of the actual cost) so that the product cost can be determined well in advance and the pricing of the product can be done on time. Since the actual cost cannot be predicted at the initial stage of the production process, the estimated cost is recorded in the books. Any deviation of the estimated cost of the actual cost is adjusted in the books at the end of the period.

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