Accounting · Variance Analysis
A company has correctly calculated a favourable direct material variance by subtracting its actual direct material cost from its flexed budget direct material cost. Which of the following could have caused this variance? 1. A fall in direct material prices 2. A fall in raw material usage per unit 3. Units produced being less than budgeted 4. Units sold being less than budgeted
Verified Solution4 OptionsUpdated: October 2026👁️1 View
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- 12 and 4 only
- 22 and 3 only
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- 41 and 2 only✓
Correct answer
1 and 2 only
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