"There is no butter."
What about "Нема масла." (Is more of a statement.) 'Немає масла" sounds funny and 'grammatically inaccurate'. Suggestions?
«Нема» and «немає» mean the same thing. Both are grammatically correct, and both should be accepted.
"Там нема масла." Would be more grammatically accurate for "There is no butter."
Actually, English 'there' often acts as a dummy pronoun, not referring to any place in particular. You can't say "No butter is" or "Butter is no", so you need to re-arrange the sentence and include "there": "There is no butter". So, "there" can be a 'dummy' word to make the sentence grammatical, and therefore it's not translated.
Of course, without the context, we don't know if 'there' is a dummy word, or if it refers to some place. So, both «Там нема(є) масла» and «Нема(є) масла» should be accepted.