Final answer:
The material price variance for CC Inc. when producing 200 units and using 21,000 square feet of material at $4.20 per square foot is calculated by finding the difference between the actual cost and the standard cost at the standard price, resulting in an unfavorable variance of $4,200, option A).
Step-by-step explanation:
We have a case where CC Inc. has a standard material cost for their product which is 100 square feet per unit at $4 per square foot. When they produced 200 units, they used 21,000 square feet for $4.20 per square foot. We already have the material quantity variance which is unfavorable and amounts to $4,000. To calculate the material price variance, we would compare the standard price to the actual price paid for the materials.
The standard cost for the actual amount of material used (21,000 square feet) at the standard price ($4) would be $84,000 (21,000 square feet × $4/square foot). The actual cost for the material was $88,200 (21,000 square feet × $4.20/square foot). Thus, the material price variance is the difference between the actual cost and the standard cost: $88,200 - $84,000 = $4,200, which is unfavorable as the actual price is higher than the standard price. Therefore, the material price variance is $4,200, which corresponds to option A).