Question: 1. If a materials quantity variance is favorable and a materials price variance is unfavorable, can the total materials cost variance be favorable?
2. To use management by exception, a company
(a) need not study fixed overhead variances,
(b) should compute variances from flexible budget amounts to allow management to focus its attention on significant differences between actual and budgeted results, or
(c) should analyze only variances for direct materials and direct labor