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    Formula to compute the raw materials price variance

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    Actual price per unit of input (per lb ) $ 7.80
    Standard price per unit of input (per lb) $ 7.00
    Standard inputs allowed per unit of output 10 lbs
    Actual units of input 115,000 lbs
    Actual units of output (product) 14,400

    What is the formula to compute the raw materials price variance?

    Compute the company's raw materials price variance. As with all variances, show whether it is favorable or unfavorable.

    Explain what the variance means.

    © BrainMass Inc. brainmass.com June 3, 2020, 11:31 pm ad1c9bdddf
    https://brainmass.com/business/accounting/raw-materials-price-variance-283511

    Solution Summary

    This solution helps explore how to compute the raw materials price variance.

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