A cost variance equals the difference between the quantity variance and the price variance.

Question

Quizplus · Accepted Answer

The cost variance is the difference between the actual cost and the standard cost. The quantity variance is the difference between the actual quantity and the standard quantity. The price variance is the difference between the actual price and the standard price. Therefore, the cost variance equals the difference between the quantity variance and the price variance.

A Cost Variance Equals the Difference Between the Quantity Variance