The materials price variance can be computed either when materials are purchased or when they are placed into production.
It is usually better to compute the variance whilst materials are bought because this is when the purchasing manager, who has an obligation for this variance, has completed his or her work. in addition, recognizing the material price variance whilst materials are bought permits the employer to carry its raw materials within the inventory money owed at standard value, which greatly simplifies bookkeeping.
A Material PriceVariance (MPV) occurs whilst the real fee paid for substances utilized in production is unique to the standard fee for the materials. The material fee Variance might be favorable if the real charge paid for the substances is much less than the usual charge.
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