Reference no: EM132536377

Gilder Corporation makes a product with the following standard costs:

                                 Standard Quantity or Hours          Standard Price or Rate              Standard Cost Per Unit

Direct materials             5.3 grams                               $7.00 per gram                              $37.10

Direct labor                      1.6 hours                            $18.00 per hour                               $28.80

Variable overhead                  1.6 hours                           $7.00 per hour                              $11.20

The company reported the following results concerning this product in June.

Originally budgeted output 5,700 units

Actual output 5,600 units

Raw materials used in production 28,470 grams

Purchases of raw materials 32,700 grams

Actual direct labor-hours 5,400 hours

Actual cost of raw materials purchases $232,170

Actual direct labor cost $102,060

Actual variable overhead cost $36,180

The company applies variable overhead on the basis of direct labor-hours. The direct materials purchases variance is computed when the materials are purchased.

Question 1: The materials price variance for June is:

Option 1: $3,270 F

Option 2: $2,868 U

Option 3: $3,270 U

Option 4: $2,868 F