Question: True or false a. Computing a price variance involves multiplying the difference in the actual quantity used and the standard quantity allowed by the actual

True or false

a. Computing a price variance involves multiplying the difference in the actual quantity used and the standard quantity allowed by the actual price per unit.

b. Usage, or efficiency, variances are appropriately calculated for direct materials, but not for direct labor.

c. Traditional variance analysis is less informative than variance analysis conducted in an environment in which a company uses activity-based costing.

d. The price variance for direct materials is calculated as the difference between the actual price and the standard price, times the actual volume purchased.

e. Potential causes for an unfavorable direct labor variance include the use of higher paid workers than budgeted and unexpected increases in wage rates due to union negotiations.

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