Question

An unfavorable materials quantity variance occurs when the actual quantity used in production is less than the standard quantity allowed for the actual output of the period.
A. True
B. False

Answer 1

Answer:

B. False

Explanation:

The formula to compute the material quantity variance is shown below:

Material quantity variance = (Actual quantity - Standard quantity) × Standard rate

The material quantity variance becomes unfavorable when the actual quantity is more than the standard one and when the standard quantity is more than the actual one so it becomes favorable variance

Therefore the given statement is false