Asked by Kiana Moore on May 12, 2024
Verified
An unfavorable materials quantity variance indicates that:
A) actual usage of material exceeds the standard material allowed for output.
B) standard material allowed for output exceeds the actual usage of material.
C) actual material price exceeds standard price.
D) standard material price exceeds actual price.
Materials Quantity Variance
The difference between the actual quantity of materials used in production and the standard quantity expected, multiplied by the standard cost per unit of material.
Standard Material
The predetermined quantity and cost of materials expected to be used in producing a unit of product, used as a benchmark for cost control.
- Examine how established benchmarks for quantity and price aid in the control of material and labor costs.
Verified Answer
SC
Stephanie ClarosMay 19, 2024
Final Answer :
A
Explanation :
An unfavorable materials quantity variance occurs when actual usage of material exceeds the standard amount allowed for output. This means that more material was used than expected, resulting in higher costs and a negative impact on profitability.
Learning Objectives
- Examine how established benchmarks for quantity and price aid in the control of material and labor costs.
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