Standard Price of Raw material Rs 2 per kg Actual Price of Raw Material Rs 3 per kg Actual quantity ...........

Costing - Phase (I & II) Methods of Costing

Standard Price of Raw material: Rs. 2/- per kg

Actual Price of Raw Material: Rs. 3/- per kg.

Actual quantity of Raw material consumed: 100 kg

Standard Quantity of Raw material: 80 kg.

The Material Cost Variance will be:

Rs 140 favorable

Rs. 150 Adverse

Rs. 140 adverse

Rs. 160 adverse

Material Cost Variance (MCV)= (Standard Price x Standard Quantity) – (Actual Price x Actual Quantity)

In given problem, MCV= (2 x 80) – (3 x 100) = 140 (adverse)

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