Question

Match the cost variance component to its definition.

a. Actual quantity
b. Standard quantity
c. Actual price
d. Standard price

1. The expected price
2. The input used to manufacture the quantity of output
3. The amount paid to acquire input
4. The expected input for the quantity of output

Answer 1

1. D

2. A

3. C

4. B

Step-by-step explanation:

Price can be defined as the amount of money that is required to be paid by a buyer (customer) to a seller (producer) in order to acquire goods and services.

In sales and marketing, pricing of products is considered to be an essential element of a business firm's marketing mix because place, promotion and product largely depends on it.

In Accounting, costing is the measurement of the cost of production of goods and services by assessing the fixed costs and variable costs associated with each step of production.

The various types of cost variance components and their definition includes the following;

1. Standard price: the expected price

2. Actual quantity: the input used to manufacture the quantity of output

3. Actual price: the amount paid to acquire input

4. Standard quantity: the expected input for the quantity of output