Question

Material price variance is the difference between standard and actual prices of materials used multiplied by __________.

• A. Actual quantity of materials used
• B. Budgeted quantity of materials used
• C. Standard quantity of materials used
• D. Either A or B

Answer 1

The correct option is A Actual quantity of materials used

Material Price variance = (Standard rate-Actual rate) / Actual quantity.

Hence material price variance is the difference between standard price and actual price multiplied by actual quantity.