The direct materials flexible budget variance can be divided into two variances-the:

Question

Quizplus · Accepted Answer

The direct materials flexible budget variance is the difference between the actual cost of direct materials and the flexible budget cost of direct materials. This variance can be further divided into two variances: the price variance and the efficiency variance. The price variance is caused by differences in the actual prices paid for materials compared to the standard prices, while the efficiency variance is caused by differences in the actual quantity of materials used compared to the standard quantity allowed for the actual production. Therefore, the correct choice is D, price variance and the efficiency variance.

The Direct Materials Flexible Budget Variance Can Be Divided into Two