Question: Mr. Rogers, the production manager, has received a report showing a $10,800 unfavorable total materials variance (materials price variance plus materials quantity variance). He knows
Mr. Rogers, the production manager, has received a report showing a $10,800 unfavorable total materials variance (materials price variance plus materials quantity variance). He knows that production used 20,000 pounds less than the budgeted amount of direct materials allowed for actual output. Mr. Rogers also knows that the standard price for direct materials was determined to be 90 cents per pound.
What was the actual cost of direct materials used during the period if the standard amount allowed was estimated to be 500,000 pounds?
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