The following information summarizes the standard cost for producing one metal tennis racket frame at spaulding industries. in addition, the variances for one month's production are given. assume that all inventory accounts have zero balances at the beginning of the month. standard cost per unit standard monthly costsmaterials $ 4.00 $ 8,400direct labor 3 hrs. @ $2.50 7.50 15,750factory overhead: variable 1.90 3,990fixed 4.00 8,400$ 17.40 $ 36,540variances: material price 470.00 unfavorablematerial quantity 400.00 unfavorablelabor rate 700.00 favorablelabor efficiency 2,900.00 unfavorablewhat was the actual price paid for the direct material during the month, assuming all materials purchased were put into production?

Actual Price paid for materials = $4.2136 2,200 = $9,270

Actual price per unit = $4.2136

Explanation:

Provided information,

Standard Material per unit = $4

Total cost = $8,400

Standard Quantity = $8,400/$4 = 2,100 units

Provided Material Price variance = $470 unfavorable = - $470

Material Quantity Variance = $400 Unfavorable = - $400

Using Material Quantity Variance

- $400 = (2,100 - Actual Quantity) $4

-$400/$4 = 2,100 - Actual Quantity

Actual Quantity = 2,100 + 100 = 2,200 units

Now, putting this value in Material Price Variance we have,

- $470 = ($4 - Actual Price) 2,200

-$470/2,200 = $4 - Actual Price

- $0.214 = $4 - Actual Price

Actual Price = $4 + $0.2136 = $4.2136

Final Answer

Actual Price paid for materials = $4.2136 2,200 = $9,270

Actual price per unit = $4.2136

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