If a company follows a practice of isolating variances at the earliest point in time,what would be the appropriate time to isolate and recognize a direct material price variance?
A) When material is issued.
B) When material is purchased.
C) When material is used in production.
D) When production is completeD.

Question

Quizplus · Accepted Answer

The direct material price variance should be isolated and recognized at the time of purchase, as this is when the actual price paid can be compared to the standard price.

If a Company Follows a Practice of Isolating Variances at the Earliest