9. The materials price variance reveals the difference between ____________________. (Points : 1)
the price paid for materials and the quantity of materials used
the quantity of materials used and the quantity of materials allowed for good output
none of the solutions offered here
the standard price for materials purchased and the amount actually paid for those materials
The answer is: the standard price for materials purchased and the amount actually paid for those materials.
To calculate the materials price variance, you need to compare the standard price for materials purchased with the actual price paid for those materials. Here's how you can calculate it:
1. Determine the standard price per unit of material: This is the expected or planned price per unit of material that should have been paid.
2. Determine the actual price per unit of material: This is the price actually paid for each unit of material purchased.
3. Calculate the difference between the standard price and the actual price for each unit of material: Subtract the actual price per unit from the standard price per unit.
4. Multiply the difference by the quantity of materials purchased: Multiply the difference obtained in step 3 by the total quantity of materials purchased.
The result will be the materials price variance, indicating the difference between the standard price for materials purchased and the amount actually paid for those materials.