A Firm's Purchasing Manager Bought Poor Quality Material at a Large

Multiple Choice

A firm's purchasing manager bought poor quality material at a large saving. Because of the lower quality of material, more scrap was produced and because of the extra labour hours required an additional employee had to be hired to assist in the cutting operation. Assuming only the facts given, what variance(s) would result?

A) Favourable material price
B) Favourable material price; unfavourable material quantity; unfavourable labour efficiency
C) Favourable material price; unfavourable material quantity; unfavourable labour efficiency; unfavourable labour rate
D) Favourable material price; unfavourable labour efficiency