Price Variance Calculator

About this calculator

In standard costing, price (or rate) variance measures how much actual spending differed from budget purely due to a price change, holding quantity constant: Price Variance = (Actual Price − Standard Price) × Actual Quantity. A positive variance (paying more than standard) is unfavorable, while paying less than standard is favorable.

Manufacturing and purchasing teams use price variance, alongside its counterpart quantity (usage) variance, to isolate exactly why actual costs deviated from budget — separating “we paid a different price per unit” from “we used a different amount of material” — which is essential for holding purchasing departments accountable and negotiating with suppliers. This calculator takes your actual price, standard price, and actual quantity and returns the variance and whether it’s favorable.