A favorable materials price variance coupled with an unfavorable materials usage variance would most likely result from: (CMA adapted)
A) machine efficiency problems.
B) product mix production changes.
C) labor efficiency problems.
D) the purchase of lower-than-standard-quality materials.

Question

Quizplus · Accepted Answer

The purchase of lower-than-standard-quality materials can lead to a favorable price variance due to lower costs, but it may also result in an unfavorable usage variance if the materials are of poor quality and more are needed to meet production standards.

A Favorable Materials Price Variance Coupled with an Unfavorable Materials