The materials price variance last year for Shady McShade is $750 favorable.
The materials price variance is the difference between the standard cost and the actual cost per unit multiplied by the actual units used in production.
The materials price variance can be computed as the budgeted price per unit minus the actual price per unit and multiplied by the actual quantity of direct material used.
Total materials variance = $1,750 favorable
Materials quantity variance = $1,000 favorable
Materials price variance = $750 favorable ($1,750 - $1,000)
Thus, the materials price variance last year for Shady McShade is $750 favorable.
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