Acompany uses sugar in producing its product. if the price of sugar doubles, which variance is directly impacted? a) direct materials quantity varianceb) direct materials price variancec) direct labor rate varianced) direct labor efficiency variance

B) Direct materials price variance

Explanation:

Company uses sugar while producing a product, that means it is a direct material for the product, further provided that cost gets doubled of buying a unit of sugar, that is actual rate is now twice of earlier rate.

Therefore since only direct material price variance uses actual rate it will be affected.

Direct Material Price Variance = (Standard Price - Actual Price) Actual quantity.

Else labor variance does not use direct material price, therefore option C) and option D) are invalid further direct material quantity variance uses standard rate and no actual rate is used.

Therefore correct option is

D) Direct Material Price Variance

it should be

fractionally backed paper money

fiat money

paper money

metallic money