Question

A favorable direct materials price variance and an unfavorable direct materials quantity variance might indicate which of the​ following? A. More​ expensive, superior materials requiring less than the standard amount were used in production. B. Less​ expensive, inferior materials requiring less than the standard amount were used in production. C. More​ expensive, superior materials requiring more than the standard amount were used in production. D. Less​ expensive, inferior materials requiring more than the standard amount were used in production.

Answer 1

Answer: B. Less​ expensive, inferior materials requiring less than the standard amount were used in production.

Explanation: Direct material price variance is the difference in actual material spend on direct material purchased in a give period of time and the amount that would have been spent if the material had been acquired at a standard price.

The favorable direct material price variance and an unfavorable direct materials quantity variance will indicate a" less expensive, inferior material requiring less than the standard amount were used in production".