Which Formula Is Used to Calculate the Materials Price Variance

question 12

Multiple Choice

Which formula is used to calculate the materials price variance?

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

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Definitions:

Microsoft

An American multinational technology company known for its software, services, devices, and solutions.

Negative Returns

A situation in which a company or investment incurs more cost than the income it generates, leading to financial loss.

Economists

Professionals who study, develop, and apply theories and concepts from economics to understand how economies function and how economic agents interact.

Average Total Cost

The total cost of production (fixed plus variable costs) divided by the number of units produced, indicative of the cost per unit of production.