A Company Has Established 5 Pounds of Material M at $2

Multiple Choice

A company has established 5 pounds of Material M at $2 per pound as the standard for the material in its Product A. The company has just produced 1,000 units of this product, using 5,200 pounds of Material M that cost $9,880.The direct materials price variance is:

A) $520 unfavorable.
B) $400 unfavorable.
C) $120 favorable.
D) $520 favorable.
E) $400 favorable.