Answer:[tex]67500[/tex]
The right solution is "13,675 U".
Explanation:
According to the question,
The standard material cost will be:
= [tex]25000\times (\frac{90000}{30000} )\times 0.90[/tex]
= [tex]25000\times 30000\times 0.90[/tex]
= [tex]67,500[/tex]
The actual material cost will be:
= [tex]95500\times 0.85[/tex]
= [tex]81,175[/tex]
hence,
The total material price variance will be:
= [tex]Actual \ cost - Standard \ cost[/tex]
= [tex]81175-67500[/tex]
= $[tex]13,675[/tex] (Unfavorable)
