Which of the following is a possible reason why actual prices might differ from standard prices,resulting in a direct materials price variance?
A)The company may receive a discount for materials that are purchased in large quantities.
B)The company may receive a reduced price from a new vendor to generate business.
C)The vendors may change their prices as a result of changes in the market.
D)All of these answer choices are correct.

Question

Quizplus · Accepted Answer

All of the answer choices are possible reasons why actual prices might differ from standard prices and result in a direct materials price variance. A company could receive a volume discount for purchasing materials in large quantities (option A), negotiate a reduced price with a new vendor (option B), or experience price fluctuations due to changes in the market (option C). Therefore, D is the correct answer.

Which of the Following Is a Possible Reason Why Actual