Materials Price Variance Definition:
Materials price variance is a measure of the difference between the actual unit price paid for an item and the standard price, multiplied by the quantity purchased.
Formula of Direct Materials Price Variance:
[Materials Price Variance = (Actual quantity purchased × Actual price) − (Actual quantity purchased × Standard price)]
Learn More About Materials Price Variance:
- What is the purpose of calculating this variance?
- What is the formula of direct materials price variance?
- What is the significance of this variance?
- Who is responsible for unfavorable materials price variance?
- And examples
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