Question

A favorable price variance for direct materials indicates that: Group of answer choices a lower price than planned was paid for materials a higher price than planned was paid for materials less material was used during production than planned for actual output more material was used during production than planned for actual output

Answer 1

Answer:

a lower price than planned was paid for materials

Explanation:

Direct material price variance is the difference between actual cost and standard cost.

Price variance is favourable when actual cost is less than standard cost. That is, when a lower price than planned was paid for materials.

Price variance is unfavourable when actual cost is greater than standard cost. This is, a higher price than planned was paid for materials.

I hope my answer helps you.