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

A favorable materials price variance would result from the purchase of lower-than-standard quality materials, while an unfavorable materials usage variance would indicate that the materials were not used efficiently. Machine efficiency problems or labor efficiency problems would affect the labor cost variance, while product mix production changes would affect the sales mix variance. Therefore, the most likely scenario is that lower quality materials were purchased but were not used efficiently during the production process.

A Favorable Materials Price Variance Coupled with an Unfavorable Materials