Question
Material cost variances are analyzed to understand the
reasons for differences between actual and standard costs. The material cost variance is the total variance. Given, material cost variance is Rs. 9,400 (favorable) and material usage variance is Rs. 8,200 (adverse), then material price variance (MPV) isSolution
MCV=MPV+MUV 9,400=MPV−8,200 MPV=9,400+8,200 MPV=17,600
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