Is there a formula for calculating direct materials price and usage variance?
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Is there a formula for calculating direct materials price and usage variance?
Material Price Variance = Qa (Ps-Pa)
Where Qa is actual quantity used, Ps is standard/budget price and Pa is actual price
Material Efficiency Variance = Ps (Qs-Qa)
Where Ps is standard/budget price, Qs is budget quantity, and Qa is actual quantity used
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