If the actual price of direct materials is $200 and the standard price of the direct materials is $180,
A)There will be no direct materials quantity variance
B)The direct materials quantity variance will be unfavorable
C)The direct materials price variance will be favorable
D)The direct materials price variance will be unfavorable

Question

Quizplus · Accepted Answer

The direct materials price variance is calculated as (Actual price - Standard price) x Actual quantity.

In this case, the actual price is $200 and the standard price is $180. Therefore, the direct materials price variance is ($200 - $180) x Actual quantity, or $20 unfavorable per unit.

There is no information provided about the actual quantity, so we cannot determine the direct materials quantity variance.

If the Actual Price of Direct Materials Is $200 and the Standard