Material Usage Variance – meaning.

Material usage (or quantity) variance arises due to the difference in standard quantity specified and actual quantity of materials used.

Material usage variance may also arise due to:

  • Negligence in the use of materials,
  • More wastage of materials by untrained workers or defective methods of production



  • Loss due to pilferage, 
  •  Use of material mix other than the standard mix
  • More or less yield from materials than the standard set, and
  • Defective production necessitating the use of additional materials.

Materials usage variance = Standard Price (Standard Quantity – Actual Quantity)

The quantities of the material specified and actually used are taken and the standard price per unit is used. If the answer from the above-mentioned formula is in plus, the variance will be a favorable variance but if the answer is in minus the variance will be unfavorable or adverse.

2 thoughts on “Material Usage Variance – meaning.”

  1. Pingback: Material Purchase Budget - ACCA ONLINE ACCOUNTING TEACHER

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