Which department is customarily held responsible for an unfavorable materials quantity variance?
A) Quality control
If the total materials variance for a given operation is favorable, why must this variance be further evaluated as to price and usage?
A) There is no need to further evaluate the total materials variance if it is favorable.
B) Generally accepted accounting principles require that all variances be analyzed in three stages.
C) All variances must appear in the annual report to equity owners for proper disclosure.
D) A further evaluation lets management evaluate the activities of the purchasing and production functions.
When are the following direct materials variances ideally reported?
A) Option A
B) Option B
C) Option C
D) Option D
In the general model, a price variance is calculated as:
A) (AP × AQ) - (AP × SQ)
B) (AP × SQ) - (SP × SQ)
C) (AP × AQ) - (SP × AQ)
D) (AP × AQ) - (SP × SQ)