Purchasing a higher quality of materials than is specified by the standard will likely result in
A)a favorable price variance.
B)an unfavorable quantity variance.
C)an unfavorable price variance.
D)a favorable price variance and an unfavorable quantity variance.

Question

Quizplus · Accepted Answer

If a higher quality of materials is purchased than what is specified by the standard, it will generally result in an unfavorable price variance because the higher quality materials usually cost more. While the quality may be better, the cost will be higher, resulting in a negative impact on the price variance.

Purchasing a Higher Quality of Materials Than Is Specified by the Standard