Purchasing a higher quality of materials than is specified by the standard will likely result in
A)A favorable price variance
B)An unfavorable quantity variance
C)An unfavorable price variance
D)A favorable price variance and an unfavorable quantity variance

Question

Quizplus · Accepted Answer

Purchasing a higher quality of materials than is specified by the standard will result in an unfavorable price variance because the actual cost will be higher than the standard cost. There will be no effect on the quantity variance as it is based on the difference between actual and standard quantity, not quality.

Purchasing a Higher Quality of Materials Than Is Specified by the Standard