The materials quantity variance is calculated based on the actual quantity of materials used compared to the budgeted quantity for the job. If the actual quantity used is less than the quantity budgeted for the job, the quantity variance is favorable.

Question

The materials quantity variance is calculated based on the actual quantity of materials used compared to the budgeted quantity for the job.  If the actual quantity used is less than the quantity budgeted for the job, the quantity variance is favorable.

BlackTom AI · Accepted Answer

Materials quantity variance equals (Actual quantity used − Budgeted/Standard quantity allowed) × Standard (budgeted) price per unit.

1. Relevant knowledge points and concepts
- Materials quantity (or usage) variance measures the difference in quantity of direct materials actually used versus the standard (budgeted) quantity for the output produced, valued at the standard price.  
- Formula: Quantity Variance = (AQ − SQ) × SP, where AQ = Actual Quantity used, SQ = Standard Quantity allowed, SP = Standard Price per unit of material.  
- Sign convention: a negative result (AQ < SQ) is favorable (F) because less material was used than expected; a positive result (AQ > SQ) is unfavorable (U).

2. Step-by-step reasoning process
- Compare actual quantity used (AQ) with budgeted/standard quantity allowed (SQ).  
- Compute the difference (AQ − SQ).  
- Multiply that difference by the standard price (SP) to convert quantity difference into a cost variance.  
- Interpret sign: if AQ < SQ, (AQ − SQ) is negative, producing a negative cost variance which is recorded as favorable.

3. Intermediate/calculation example
- Suppose SQ = 100 kg, SP = $5/kg, AQ = 90 kg.  
- Difference: AQ − SQ = 90 − 100 = −10 kg.  
- Quantity variance: −10 kg × $5/kg = −$50 → recorded as $50 favorable.

4. Why the correct answer is correct
- The statement matches the definition and formula: when actual quantity used is less than the budgeted quantity, the difference (AQ − SQ) is negative and therefore the variance indicates cost savings (favorable).

5. Why the other option is incorrect
- The only alternative (False) would assert that using less than budgeted does not produce a favorable variance; that contradicts the standard variance definition and sign interpretation.

6. Conclusion
- Therefore the correct response is True, which matches the provided answer.

The materials quantity variance is calculated based on the actual quantity of materials used compared to the budgeted quantity for the job. If the actual quantity used is less than the quantity budgeted for the job, the quantity variance is favorable.判断题

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