Question

In: Accounting

A favorable direct materials price variance indicates which of the​ following: A. The actual quantity of...

A favorable direct materials price variance indicates which of the​ following:

A.

The actual quantity of material used was less than the standard quantity of material used.

B.

The standard cost of materials purchased was greater than the actual cost of materials purchased.

C.

The actual cost of materials purchased was greater than the standard cost of materials purchased.

D.

The standard cost of materials purchased was less than the actual cost of materials purchased.

Solutions

Expert Solution

Answer :

B) The Standard Cost of Material Purchased was Greater that the Actual cost of Material Purchased

Direct Material Price Variance = Actual cost of Material Purchased - Standard Cost of Material Purchased

IF : Standard cost > Actual cost , favorable Material Price Variance , vice-versa

ekkarill92 answered 2 years ago
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