A favorable price variance for direct materials indicates that:
A)a lower price than expected was paid for materials.
B)a higher price than expected was paid for materials.
C)less material was used during production than planned for actual output.
D)more material was used during production than planned for actual output.

Question

Quizplus · Accepted Answer

A favorable price variance for direct materials means that the actual price paid for materials was lower than the expected price. This could be due to a supplier offering a discount, negotiating a better price, or purchasing materials in bulk.

A Favorable Price Variance for Direct Materials Indicates That