The point of purchase model calculates the materials price variance using the quantity of materials purchased.

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The point of purchase model uses the quantity of materials purchased to calculate the materials price variance. This variance is calculated by comparing the actual price paid for the materials to the standard price that was set for those materials. The variance represents the difference between these two prices, and it can be analyzed to help managers understand why there are differences between the expected costs of production and the actual costs that were incurred.

The Point of Purchase Model Calculates the Materials Price Variance