Question

A favorable materials quantity variance would occur if?

1) more material is purchased than is used
2) actual pounds of materials used were less than the standard pounds allowed
3) actual labor hours used was greater than the standard labor hours allowed
4) actual pounds of materials used was greater than the standard pounds allowed

Answer 1

A favorable materials quantity variance occurs when the actual quantity of materials used is less than the standard allowed for the output.

Step-by-step explanation:

A favorable materials quantity variance would occur if the actual quantities of materials used in production are less than the standard quantities allowed for the actual output. Option 2) actual pounds of materials used were less than the standard pounds allowed correctly defines a situation where a favorable materials quantity variance would occur. The concept of material quantity variance is based on the principle that variable costs, such as those for raw materials, change with the output level.

A favorable materials quantity variance occurs when actual pounds of materials used are less than the standard pounds allowed. A favorable materials quantity variance would occur if actual pounds of materials used were less than the standard pounds allowed.