Direct material quantity variance

True Tamplin

Written by True Tamplin, BSc, CEPF®
Updated on June 22, 2021

What is Direct Material Quantity Variance?

Direct material quantity variance (also known as direct material usage or volume variance) is a part of the overall material cost variance which occurs because of the difference between the actual quantity of direct material used and standard quantity allowed for the output. It indicates whether or not the material has been properly utilized.
A favorable materials quantity variance indicates saving in the use of direct material. An unfavorable variance, on the other hand, indicates that the material used is in excess of the standard requirement.

ْDirect Material Quantity Variance Formula


Example (How to Calculate Direct Material Quantity Variance?)

The Blue Sky Company provides the following data for the month of June 2016:

  • Direct materials used: 4,000 units
  • The standard quantity allowed: 4,200 units
  • Standard price per unit of direct material: $5

Required: Calculate direct material quantity variance for Blue Sky Company. Also indicate whether it is favorable or unfavorable.


The direct material quantity variance of Blue Sky Company is favorable because the actual quantity of material used is less than the standard quantity allowed.

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