Hurst Company's standard variable materials cost per unit was $8. The actual materials cost per unit on production of 10,000 units was $8.22. Based on this information, Hurst Company incurred an unfavorable variable materials price variance of $2,200.
Answer the following statement true (T) or false (F)
True
Price variance = (Actual price ? Standard price) × Actual quantity
Price variance = ($8.22 per unit ? $8.00 per unit) × 10,000 units = $2,200
Since the actual price was greater than the standard price, the variance is unfavorable.
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