Question

Total Material Cost Variance =_______________________.

• A. Standard cost of materials $-$ Actual cost of materials
• B. Budgeted cost of materials $-$ Actual cost of materials
• C. Standard cost of materials $-$ Budgeted cost of materials
• D. Actual cost of materials $-$ Budgeted cost of materials

Answer 1

Answer: (A)

Standard cost of materials $-$ Actual cost of materials

Total material cost variance is the difference between the standard cost of material and actual cost of material. This can be formulated as:

Total Material Cost Variance=

(Standard Usage*Standard Price)- (Actual Usage*Actual Price)