A Favorable Direct Materials Price Variance Indicates Which of the Following

question 88

Multiple Choice

A favorable direct materials price variance indicates which of the following?

• A)The actual cost of materials purchased was greater than the standard cost of materials purchased.
• B)The standard cost of materials purchased was less than the actual cost of materials purchased.
• C)The Actual Quantity (AQ)of materials used was less than the standard quantity of materials used for actual production.
• D)The standard cost of materials purchased was greater than the actual cost of materials purchased.

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Definitions:

Economic Generation

The cohort of individuals born and living at about the same time, regarded collectively as participants in the market economy.

Total Output

The total quantity of goods or services produced by a firm or country within a specific period.

Economic Expansion

A phase in the business cycle where the economy grows and increases its output, characterized by a rise in employment, consumer spending, and production.

Mild Recession

A period of slight economic decline wherein the economy's growth slows down, but the downturn is not severe enough to be classified as a full recession.