Answer the following questions using the information below:
These questions refer to flexible-budget variance formulas with the following descriptions for the variables: A = Actual; B = Budgeted; P = Price; Q = Quantity.
-Which variance is calculated by using the formula: (AP - BP) AQ is the ________.
A) efficiency variance
B) price variance
C) total flexible-budget variance
D) material spending variance

Question

Quizplus · Accepted Answer

The formula (AP - BP) AQ calculates the price variance, which measures the difference between the actual price paid for a quantity of inputs and the budgeted price for that same quantity of inputs.

Answer the Following Questions Using the Information Below