The variance that is usually most useful in assessing the performance of the purchasing department manager is:

		the materials quantity variance.
		the materials price variance.
		the labor rate variance.
		the labor efficiency variance.

Question 35

Which of the following would produce a materials price variance?

		An excess quantity of materials used.
		An excess number of direct labor-hours worked in completing a job.
		Shipping materials to the plant by air freight rather than by truck.
		Breakage of materials in production.

Question 36

An unfavorable labor rate variance can occur if workers with high hourly wage rates are assigned to work on products with standards that assume workers have low hourly wage rates.

True

False