Answer (C) is correct . The direct materials price variance is found by multiplying the difference between the actual price (AP) of direct materials and the standard price (SP) per unit by the actual quantity (AQ). AQ × (AP – SP) = MPV 28,000 × ($2.00 – $2.20) = $5,600 favorable
Answer (A) is incorrect because The direct materials price variance is found by multiplying the actual quantity (28,000) times the difference between the AP ($2.00) and the SP ($2.20).
Answer (B) is incorrect because The direct materials price variance is found by multiplying the actual quantity (28,000) times the difference between the AP ($2.00) and the SP ($2.20).
Answer (D) is incorrect because The usage variance is $2,200 unfavorable.
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What is the direct materials price variance?
