If the actual amount of direct materials used equals the standard amount of direct materials that should have been used,the difference between the standard cost and actual cost of direct materials is called the
A)price variance.
B)rate variance.
C)quantity variance.
D)efficiency variance.

Question

Quizplus · Accepted Answer

The difference between the standard cost and actual cost of direct materials, when the actual amount used equals the standard amount, is referred to as the price variance. This variance focuses on the difference in cost, not the quantity of materials used.

If the Actual Amount of Direct Materials Used Equals the Standard