For a direct material,which one of the following is the difference between the actual and standard unit price of the direct material multiplied by the actual quantity of the material purchased?
A)Direct materials price variance.
B)Direct materials volume variance.
C)Direct materials usage variance.
D)Direct materials flexible-budget variance.
E)Direct materials mix variance.

Question

Quizplus · Accepted Answer

The difference between the actual and standard unit price of the direct material multiplied by the actual quantity of the material purchased is known as direct materials price variance. This variance measures the difference in cost incurred for the actual materials purchased compared to the standard cost allowed for those materials. It is used to evaluate the effectiveness of the purchasing function by indicating whether the purchasing department is paying the appropriate price for the materials.

For a Direct Material,which One of the Following Is the Difference