State material price variance, Managerial Accounting

State Material price variance

Difference among standard price and the actual price of the material is the material price variance. This variance arises because of various factors such as:

Change in market price

Uneconomical size of purchase order

Not availing of discount facilities

Payment of more/less freight cartage charges etc.

Transits loss, if barns by the purchase

Change in duties and taxes etc

Material price variance is the direct responsibility of the purchase department. Certain situation may arise when material price variance is made uncontrollable, as price depends on the factors of demand and supply in the market. In such a case the purchase department or other personnel is not accountable for the variance.

Material price variance is stated as:

Defective equipment and tools

Use o inferior material

Change in composition of material mixture

Yield form material more/less etc.

 

Posted Date: 7/8/2013 7:15:06 AM | Location : United States







Related Discussions:- State material price variance, Assignment Help, Ask Question on State material price variance, Get Answer, Expert's Help, State material price variance Discussions

Write discussion on State material price variance
Your posts are moderated
Related Questions
CONTIGENCY THEORY Some researchers have argued that the context in which budgetary control is used is as important as the style in which it is implemented and used. This is ter

Cash to debt service ratio  Cash to debt service ratio also known as debt cash flow coverage ratio is an improvement over the interest coverage ratio and is calculated. The

The president expects sales to increase by 12% next year. By how much should net operating income increase? Sales $2,000,000 Variable expenses 1,000

Explain:- Q.1 As a potential investor, what is the problem with different countries having different accounting standards? As the president of a multinational company, what is

Explain product cost Product costs are those costs which are associated with and directly identifiable with the product. In other words, which are assigned to the product are p

Account analysis (Inspection of accounts) method: This method requires that departmental managers and the accountant inspect each item of expenditure within the accounts for s

Hi there, i am looking an expert to make my assignments for this subject and i do have other subjects as well. Let me know how you can go through my assignment.

Explain about Cost centre: Meaning & definition: cost centre is defined as a location, person or item of equipment (or group of them) in respect which costs may be ascertaine

I am part of a marketing group, and we are working on a project for a local cable company,they currently serve 3,200 customers and sell 50 wireless boxes a month,what I need to do

What is the objective of performance budgeting The objectives of performance budgets is to provide a closer linkage between planning and action and also to provide a common bas