Material usage variance can be calculated using the formula —

CS Executive · Cost and Management Accounting · PYQS · June 2015
Material usage variance can be calculated using the formula —
(A) (Standard quantity for actual output - Actual quantity) × Actual price
(B) (Standard quantity for actual output - Actual quantity) × Standard price
(C) (Standard price - Actual price) × Actual quantity
(D) (Standard price - Actual price) × Standard quantity.

Answer & Explanation:

Correct Answer: Option (B)

Official answer key: (B).

Topics: Standard Costing

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