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Direct Materials Price Variance
The difference between the actual cost of direct materials used in production and the expected (standard) cost, which indicates how efficiently materials are purchased.
Direct Materials
Raw materials that are directly incorporated into a finished product and can be directly assigned to the product.
Standard Costs
Predetermined cost estimates used to measure the cost performance of an operation, allowing for budgeting and variance analysis against actual costs.
Standard Price
A predetermined cost of a resource or product, used for budgeting and cost control purposes.
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