The direct materials usage ratio for a given period is:
A) Defined as the ratio of quantity purchased to quantity used.
B) Defined as the inverse of the materials quantity variance for the period.
C) Entered into its own variance account at the end of the period.
D) A useful indicator of performance by the manufacturing department.
E) A useful indicator of performance of the purchasing department.

Question

Quizplus · Accepted Answer

The direct materials usage ratio is a measure of how efficiently materials are used in the production process, making it a useful indicator of the performance of the manufacturing department. It assesses the quantity of materials used in production against the standard or expected quantity for the output produced.

The Direct Materials Usage Ratio for a Given Period Is