Which Formula Is Used to Calculate the Materials Price Variance

question 149

Multiple Choice

Which formula is used to calculate the materials price variance?

• A) (actual price × actual quantity) - (standard price × actual quantity)
• B) (standard price × actual quantity) - (actual price × actual quantity)
• C) (actual price × actual quantity) - (standard price × standard quantity)
• D) (standard price × standard quantity) - (actual price × actual quantity)

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Definitions:

Reactive

Responding to changes or issues as they occur rather than anticipating and preparing for them in advance.

MTBF Distributions

Mean Time Between Failures distributions, a statistical measure used to describe the expected reliability or availability of a system over time.

Infant Mortality

The failure rate early in the life of a product or process.

Normal Distribution

A probability distribution which is even around the mean, indicating that data points closer to the mean occur more frequently than those further away from the mean.