Answer :
Final answer:
The direct materials price variance is calculated by comparing the standard price per pound with the actual price per pound and multiplying it by the difference in pounds used. In this case, the variance is -$134,400.
Explanation:
The direct materials price variance is a measure of the difference between the standard cost of materials and the actual cost of materials used in production. To calculate the direct materials price variance, we need to compare the standard price per pound with the actual price per pound and multiply it by the difference in pounds used.
In this case, the standard price per pound is $56 and the actual price per pound is $58.
The standard quantity of material used is 8 pounds per unit, and the actual quantity used is 67,600 pounds.
Using the formula: Direct Materials Price Variance = (Standard Price - Actual Price) * Actual Quantity, we can calculate the variance to be $(56 - 58) * 67,600 = -$134,400.
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