Jt engineering usually pays $21 per pound of copper and uses 300 pounds of copper per 1,000 widgets. due to the current high demand for copper, jt is currently paying $32 per pound of copper. what will jt’s materials price variance be for this purchase? a : $3,300b : $3,200c : $1,300d : $2,100

A : $3,300

Explanation:

Given;

Initial cost = $21 per pound of copper

Current cost = $32 per pound of copper

Cost variance = $32 - $21

                       = $11

If 300 pounds of copper per 1,000 widgets, then

JT’s materials price variance be for this purchase

= Cost variance × Pound required

= $11 × 300

= $3,300

The right answer is A : $3,300

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