Multiplying the difference between actual materials price per unit and the standard materials price per unit by actual quantity of materials used is known as the:
A) Sales volume variance.
B) Materials price variance.
C) Labor price variance.
D) Materials usage variance.

Question

Quizplus · Accepted Answer

This calculation represents the materials price variance, which shows the difference between the actual cost of materials and the expected cost based on the standard price. Multiplying this difference by the actual quantity used gives the total variance for materials price. The other options listed are not related to this specific calculation.

Multiplying the Difference Between Actual Materials Price Per Unit and the Standard