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Why would a favorable price variance for material might be the cause of unfavorable quantity variance?
Wiki User
∙ 12y ago
A favorable/unfavorable price variance does not effect your quantity variance. The reason you would see a favorable price variance and an unfavorable quantity variance is because you consumed more materials than your standard allows AND the price you paid for those material was less than your standard price. If you paid more than your standard price, you would have experienced an unfavorable variance in both quantity and price.
Wiki User
∙ 12y ago
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An unfavorable material quantity variance indicates?
actual usage of materials exceeds the standard material allowed for output
What are the causes direct material quantity variance?
what are some of the causes of material quntity variance of favourable amount
What does a favorable direct materials efficiency variance indicate?
A favorable direct materials efficiency variance indicates that you are using less material in production than was budgeted for.
Favorable materials quanity variance?
In cost accounting, a variance is the difference between what we expected to happen (what we planned for when we created the budget) and what actually happened. If we produce more units from a given quantity of raw material than we expected to produce when we set up the budget, we have a favorable materials quantity variance, because we produced the goods more efficiently than we had planned for. We have used the raw materials with less waste than expected.
Causes material quantity variance?
causes of labor rate variances
An unfavorable material quantity variance indicates?
actual usage of materials exceeds the standard material allowed for output
What difference between a favorable variance and an unfavorable variance?
Favourable variance is that variance which is good for business while unfavourable variance is bad for business
What are the causes direct material quantity variance?
what are some of the causes of material quntity variance of favourable amount
What does a favorable direct materials efficiency variance indicate?
A favorable direct materials efficiency variance indicates that you are using less material in production than was budgeted for.
Favorable materials quanity variance?
In cost accounting, a variance is the difference between what we expected to happen (what we planned for when we created the budget) and what actually happened. If we produce more units from a given quantity of raw material than we expected to produce when we set up the budget, we have a favorable materials quantity variance, because we produced the goods more efficiently than we had planned for. We have used the raw materials with less waste than expected.
What type of variance is excess usage?
Since actual usage of the direct material was greater than the standard allowed, the excess usage is called an unfavorable variance
Causes material quantity variance?
causes of labor rate variances
Causes of direct material quantity variance?
Some causes of direct material quantity variance are poor quality materials, untrained workers, and lack of supervision. Production managers should look at and determine the causes.
What are the Causes of direct material quantity variance?
An unfavorable materials quantity variance means excessive use of direct materials. The excessive use of direct materials may be the result of a number of reasons including: inexperienced or untrained workers, lack of motivation, lack of proper supervision, use of outdated machinery, faulty equipment, purchase of unsuitable or substandard materials, and frequent power failures.
What factors causes Budget Variance?
There are 7 variances associated with a budget ( which are generally calculated for controlling purposes) 1- Material Price variance 2- Material Quantity variance 3- Labor rate variance 4- Labor efficiency variance 5- Spending variance 6- Efficiency variance 7- Capacity variance
What is cost price variances?
Price variance is the actual unit cost minus the standard unit cost, multiplied by the actual quantity purchased. The variance is said to be unfavorable if the actual price of the materials is higher than the standard price of the materials.
The difference between actual and standard cost caused by the difference between the actual quantity and the standard quantity is called the?
The difference between actual quantity and standard quantity is called the material quantity variance.
