What differences do price/rate variances focus on?
A)the differences between actual and standard inputs multiplied by actual prices
B)the differences between actual and standard unit prices of an input multiplied by the actual quantity of inputs
C)the differences between actual and standard inputs multiplied by standard prices.
D)the differences between actual and standard unit prices of an input multiplied by the budgeted quantity of inputs

Question

Quizplus · Accepted Answer

Price/rate variances compare the actual unit price of an input to the standard unit price of that input, multiplied by the actual quantity of inputs used. This helps identify differences in costs due to changes in price or rate, rather than changes in the quantity of inputs used. Option A and C are incorrect because they involve either actual or standard prices, but not both. Option D is incorrect because it refers to budgeted quantities instead of actual quantities used.

What Differences Do Price/rate Variances Focus On