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    wordy's Avatar
    wordy Posts: 1, Reputation: 1
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    #1

    Sep 28, 2006, 07:17 AM
    Mix and Yield variances
    Is there a formula for calculating direct materials price and usage variance?
    CaptainForest's Avatar
    CaptainForest Posts: 3,645, Reputation: 393
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    #2

    Sep 28, 2006, 06:59 PM
    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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Direct Material Variances [ 1 Answers ]

What type would it be if the price and quantity arose if the actual number of lbs of materials used exceeds standards lbs aalowed but actual cost is less than the standard cost? I think that the quantity would be favorable and the price would be unfavorable. Am I correct?

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