There will be a favorable materials price variance if:
A)The standard price per unit is less than the actual price per unit.
B)The standard price per unit is greater than the actual price per unit.
C)The actual quantity purchased is greater than expected.
D)The actual quantity purchased is less than expected.

Question

Quizplus · Accepted Answer

A favorable materials price variance occurs when the actual price per unit is lower than the standard price per unit, which means the company can save money on purchasing materials. Therefore, option B is the correct choice as it states the standard price per unit is greater than the actual price per unit.

There Will Be a Favorable Materials Price Variance If